Vizrt Reports 9 Months and Q3 2010 Results
(Thomson Reuters ONE) -
Continuous Improvements in Margins and Further Backlog Growth
Bergen, Norway, November 11, 2010. Vizrt Ltd. (Oslo Main List: VIZ)
For the first nine months of 2010, the Company recorded a 24% growth in revenues
as compared to 2009, with BG the strongest contributor to revenue growth.
Geographically, all regions contributed to the positive revenue development,
led by the Americas, followed by double digit growth both in Europe and APAC. A
positive shift in the product mix sold, including a higher portion of new
licenses, led to improved margins and operational result.
HIGHLIGHTS
* Revenues for 9M and Q3 2010 were MUSD 73.8 and MUSD 25.9, up 24% and 20%
respectively compared to the same periods LY.
* EBIT of MUSD 5.3 in 9M 2010 and MUSD 2.7 in Q3 2010 corresponding to a 7%
and 10% margin, compared to MUSD -10.2 (-17%) and MUSD -8.4 (-39%) in the
same periods LY. Q309 included a nonrecurring non cash goodwill write off of
MUSD 9.0 related to the purchase of Escenic.
* EBITDA of MUSD 9.9 for 9M 2010 and MUSD 4.3 for Q3 2010, corresponding to a
13% and 17% margin, compared to MUSD 4.0 (7%) and 2.7 (12%) in the same
periods LY.
* Backlog to date amounts to MUSD 37.7, up 10% compared to the same period LY.
* On July 12, 2010 Vizrt acquired the remaining 71% of Adactus AS. As of Q3
2010 Adactus is fully consolidated. The consolidated balance sheet as of
September 30, 2010 includes goodwill in the amount of MUSD 2.0 and
intangible assets in the amount of MUSD 2.7. The intangible assets will be
amortized over the next 7 years, most of which in the next 5 years. Adactus
contributed MUSD 0.3 to the consolidated Q3 revenues.
* Subsequent to the quarter's end, the Company invested MUSD 1.86 both in cash
and marketing services in Stergen Hi-Tech Ltd. in consideration of 19.9% of
Stergen's shares. Stergen is a developer of 2D to stereoscopic 3D video
conversion software. Additionally, the parties have entered into a
distribution agreement of Stergen's products by Vizrt.
Martin Burkhalter, Vizrt CEO, commented on the results, "We had a very solid
third quarter, which validated our positive expectations as we communicated
earlier in the year. The strong performance of our broadcast graphics business
clearly shows Vizrt's unique product offering in this area. Revenues on the MAM
side are developing very positively compared to the first 9 months of last year.
Though slightly down compared to Q2 2010, this is an anticipated seasonal effect
due to lower delivery capacity resulting from summer vacations. The Online
business is still slow, but we are seeing signs of recovery in the market. We
believe we have a very compelling product offering and that this will be a
growth area for us once market conditions in this segment improve."
"That we recorded substantial revenue growth for the first 9M 2010 in all our
geographical areas is in large part due to our efforts to regionalize our
organization. We have started this structural change in January 2010, which I
expect to be fully implemented by the end of next year."
Results Overview
In KUSD |Q3 2010|Q3 2009|Change in%|Q2 2010|Change in %
----------------------------+-------+-------+----------+-------+-----------
Revenue | 25,889| 21,537| 20%| 24,245| 7%
----------------------------+-------+-------+----------+-------+-----------
Gross Profit | 16,279| 12,798| 27%| 15,650| 4%
----------------------------+-------+-------+----------+-------+-----------
Gross Margin | 63%| 59%| | 65%|
----------------------------+-------+-------+----------+-------+-----------
EBITDA | 4,282| 2,680| 60%| 3,892| 10%
----------------------------+-------+-------+----------+-------+-----------
EBITDA-Margin | 17%| 12%| | 16%|
----------------------------+-------+-------+----------+-------+-----------
Net Recurring Income | 4,033| 587| 587%| 1,067| 278%
----------------------------+-------+-------+----------+-------+-----------
Net Recurring Income-Margin| 16%| 3%| | 4%|
----------------------------+-------+-------+----------+-------+-----------
EPS | 0.06| (0.13)| n/a| 0.02| 200%
----------------------------+-------+-------+----------+-------+-----------
Backlog | 37,716| 34,442| 10%| 37,797| 0%
----------------------------+-------+-------+----------+-------+-----------
Cash Position | 50,461| 48,753| 3.5%| 51,350| -2%
| | | | |
Vizrt Product Lines and Geographical Overview
Broadcast Graphics (BG)
BG, accounted for 73% of total revenues, or MUSD 54.0, and led growth for 9M10
compared to 9M09. In the first three quarters of 2010, a strong recovery in
demand for the Company's core BG product line was witnessed, with revenues up
29% YoY. Our structural changes are continuing to yield effect, with the
regionalization program further driving BG sales in all markets.
Media Asset Management (MAM)
MAM continues to show steady growth. For 9M 2010, MAM revenues came in at MUSD
14.1, up 23% compared to 9M 2009 and up 11% comparing Q3 2010 to Q3 2009. The
main reasons for the increase in MAM revenues were the general improvement in
market conditions and our improved capacity to deliver projects. MAM is the
second largest contributor to revenues with a share of 19% in 9M 2010.
Others - Online (ONL) & Mobile
9M 2010 revenues were MUSD 5.7, compared to MUSD 6.3 in 9M 2009, down 10%. Q3
2010 revenues came in at MUSD 1.8, up 10% compared to Q3 2009. The product line
contributed 8% to revenues in 9M 2010. Due to the volume of ONL and Mobile on a
standalone basis along with the positive trend we see in combining deals that
include both ONL and Mobile solution, we will report both as one combined
product line.
As revenues for ONL & Mobile are as yet relatively low, minor influences will
continue to contribute to disproportionate volatility. This volatility is
expected to reduce when markets recover more fully, with the associated expected
revenue growth in this business segment.
Geographical Overview
9M 2010 saw a return to growth for all regions as compared to 9M 2009. The most
significant increase was recorded in the Americas, with revenues up 32% to MUSD
18.2, as compared to MUSD 13.8 for 9M 2009. Growth in the EMEA region was 24%,
with revenues up to MUSD 41.7 in 9M 2010, as compared to MUSD 33.8 in 9M 2009.
Revenues in the APAC region were up 17% to MUSD 13.9 in 9M 2010 from MUSD 11.9
in 9M 2009.
FINANCIALS
Gross Profit and Gross Margin
The gross margin for 9M 2010 was 62% as compared to 59% for the same period LY.
This increase is mainly due to a lower HW contribution to the product mix. The
gross profit in 9M 2010 was affected by a MUSD 2.3 amortization of intangible
assets from acquisitions, compared to MUSD 2.4 in 9M 2009. Adjusted for these
amortization effects, the gross margin was 65%, compared to 63% LY.
Recurring Operating Expenses
Total recurring operating expenses for 9M 2010 were MUSD 40.5, up 12% compared
to the same period LY. The increase is mostly due to the regionalization
program that the Company has been implementing since the beginning of 2010.
This program involves the setting up of fully staffed sales and delivery
organizations in the territories that are capable of marketing, selling and
delivering of Vizrt's integrated workflow solutions. Developing and building
such an organization carries associated costs, which we expect to start paying
off going forward. Q310 recurring OPEX was up MUSD 0.3 (2%) compared to Q210,
which was mainly related to the consolidation of Adactus starting from Q310.
Order backlog
The order backlog as of November 7, 2010 was MUSD 37.7, up 10%, compared to LY
MUSD 34.4, and approximately at the same level as reported for the Q2 2010
results release date. BG backlog was at MUSD 18.4, MAM backlog at MUSD 14.2 and
Others backlog MUSD 5.1. For MAM, the backlog was up 19% compared to the same
period LY, whereas for BG and Others the backlog was up 5% and 3%, respectively,
comparing to the same period LY.
Balance Sheet, Cash Flow and Liquidity
Cash flow generation from operating activities in 9M 2010 was MUSD 4.6 compared
to MUSD 5.0 in 9M 2009.
Vizrt has a strong financial position with no interest-bearing debt and a net
cash position of MUSD 50.5 as of September 30, 2010 following a cash payment of
MUSD 3.3 related to the acquisition of Adactus, (including MUSD 0.4 restricted
cash), compared to MUSD 50.0 as of December 31, 2009. Furthermore shareholders'
equity as of September 30, 2010 was MUSD 109.2, which is equivalent to an equity
ratio of 78%.
Organization
As of September 30, 2010, the Company had 540 employees, compared to 479 as the
end of September 30, 2009. This increase is mainly due to increased staffing in
low cost countries related to the regionalization restructuring of the company
and to the additional employees of Adactus AS
OUTLOOK
Martin Burkhalter, CEO of Vizrt, stated: "Our strategy of offering multiple
product lines that can be used on their own, or integrated to provide smart end-
to-end workflow solutions, continues to pay dividends. At the recent IBC event,
where we showcased the latest evolution in this approach, our solutions were met
with great interest and customer feedback has been very encouraging. We are the
only company that can help content owners to increase their market reach by
providing them with the tools to incorporate multi-platform delivery of their
valuable media assets. This solution meets both their need to develop new
business models and at the same time allows for greater workflow efficiencies,
taking care of the bottom line. In this respect we can already state that the
Adactus acquisition is creating an encouraging momentum. The investment we made
most recently in Stergen, adding technology for the conversion of 2D to 3D to
our portfolio, helps to fuel our pipeline with highly relevant technologies,
meeting the needs of what we see as next great technological revolution in the
broadcasting industry."
"That our traditional products in BG continue to lead the way in the market
could again be seen at last week's midterm elections in the USA, where Vizrt was
taking center stage in the graphical representation of the elections. All the
major broadcasters, such as CNN, FOX, CBS, ABC, etc. used our products. The
fact that all these big players choose Vizrt for their special events coverage
has a tremendous positive effect on our brand and supports our sales efforts
across the globe."
"Our continuous efforts to develop our product offering, combined with improving
our global reach and operational efficiencies, are proving key in expanding our
market share and allow us to exploit the growth potential going forward. The
fact that we have a global presence and three different product lines, makes us
today less exposed to short term market volatilities than a few years ago."
"Based on our current results and our solid backlog, we believe, provided there
are no substantial changes in the macroeconomic environment that we are well
positioned to continue our growth path. We have a strong and very dedicated
organization and an impressive and very competitive product portfolio. Media
houses all over the globe know that Vizrt has the solutions to help them meet
the challenges and opportunities in the rapidly changing digital media world."
Investors & Analyst Conference Call
A Conference Call will be held today, November 11, 2010 at 14:00 p.m. (CET). All
interested parties are invited to join the call, please use one of the following
dial-in-numbers:+47 24 159 585 (Norway), +49 69 247 501 891 (Germany),
+44 203 147 48 61 (UK), +1 212 4 440 297 (US).
The Q4 and Full Year 2010 results will be released on February 17, 2011.
Contacts
Martin Burkhalter
CEO
+41 22 365 7501
mburkhalter(at)vizrt.com
Ofra Brown
CFO
+47 5351 8040
Schwarz Financial Communication
Frank Schwarz
+49 611 1745 3980
schwarz(at)schwarzfinancial.com
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)
[HUG#1461269]
Q3 Management Presentation:
http://hugin.info/138784/R/1461269/400459.pdf
Full Press Release incl Tables as PDF:
http://hugin.info/138784/R/1461269/400458.pdf
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originality of the information contained therein.
Source: Vizrt Ltd. via Thomson Reuters ONE
Unternehmensinformation / Kurzprofil:
Datum: 11.11.2010 - 07:30 Uhr
Sprache: Deutsch
News-ID 48651
Anzahl Zeichen: 14727
contact information:
Town:
Bergen
Kategorie:
Business News
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