OTTAWA, ONTARIO--(Marketwire - Sept. 11, 2012) - International Datacasting Corporation (TSX:IDC), a global leader in digital content distribution for the world's premiere broadcasters, today announced results for the second quarter fiscal 2013 period ended July 31, 2012.
The second quarter of fiscal 2013 was a challenging one for the Corporation, as it transitioned from a Business Acquisition Strategy ("BAQ") focus, to a strategy focused on growing the core business. This involved realigning priorities, and IDC's Board of Directors, while the Corporation became embroiled in a dissident shareholder proxy contest brought on by its former Executive Chairman and Director. Offsetting the cost of this activity, the results of the on-going operational turnaround began to positively impact the Corporation's operating expenses.
The Corporation's consolidated revenue for second quarter fiscal 2013 was $6.3 million down 15% from $7.4 million in second quarter fiscal 2012. Net income (loss) was ($305,000) compared to net income of $88,000 in the second quarter fiscal 2012. For the six months ended July 31, 2012, the Corporation reported consolidated revenues of $16.0 million and net income (loss) of ($512,000), compared to consolidated revenues of $15.7 million and net income (loss) of ($423,000) for the same period in the prior year. Excluding unusual operating charges, the Corporation's operating results were strong and would have reported a net income of $299,000 for the current quarter and $106,000 for the first half of fiscal 2013.
For the Three Months Ended July 31 2Q FY2013 vs. July 31 2Q FY2012
- Revenue was $6.3 million, a decrease of 15%, compared to $7.4 million in 2Q fiscal 2012 mainly due to lower IDC Systems revenue from the completion of the DTH Broadcasting project in Kenya in Q1 2013.
- Gross margin, as a percentage of revenue increased from 46% in 2Q fiscal 2012 to 47% in 2Q fiscal 2013.
- Operating expenses decreased 2% to $3.2 million in 2Q fiscal 2013 from $3.3 million in 2Q fiscal 2012. Included in Q2 2013 Operating expenses were $604,000 related to the discontinued business acquisition strategy and the dissident shareholder proxy contest.
- Operating income (loss) was a loss of ($ 285,000), or ($0.01) per share, compared to income $67,000 or $0.00 per share in 2Q fiscal 2012.
- Net income (loss) was ($305,000), or ($0.01) per share, in 2Q fiscal 2013, compared to net earnings of $88,000, or $0.00 per share, in 2Q fiscal 2012.
- Adjusted EBITDA(1) was $442,000, an increase of 23% compared to the same period last year
Revenues for the IDC Products segment decreased 6% from $5.1 million to $4.8 million from second quarter fiscal 2012 to second quarter fiscal 2013. This is attributable to a decline in US markets, partially offset by strong growth in Latin America and Pacific Rim markets.
Revenues for the IDC Systems segment declined 35% from $2.2 million in second quarter fiscal 2012 to $1.4 million in second quarter fiscal 2013. The decrease in IDC Systems revenue is attributable to the completion of the first phase of DTH Broadcasting project in Kenya in Q1 2013.
During the second quarter of fiscal 2013, IDC successfully entered into three contracts valued in excess of $2 million to manage secure live and file based content distribution for premiere broadcasters serving the Latin American, North American and European markets. This includes Grupo ChileFilms, which owns and operates CINECOLOR SAT, a satellite cinema distribution system delivering content through Latin America. IDC was also selected by Eurovision, operated by the European Broadcasting Union (EBU) for an enhanced news content distribution network. Additionally, IDC entered into a contract with towerCast, based in France, for the expansion of their vast radio broadcast network.
The Corporation continues to invest strategically in new content distribution products such as IDC LASER™ and Digital Tattoo™, which were both launched in first quarter and are gaining increased visibility in key markets through second quarter, including their European launch this week at IBC in Amsterdam and at the Asian launch, CommunicAsia, in June.
IDC continues to focus on managing costs, and as such, completed a restructuring to reduce the Corporation's cost base in the first quarter. In the second quarter of fiscal 2013, the Board made the decision to discontinue an unsuccessful Business Acquisition Strategy to further reduce costs and focus on the Corporation's core business.
"In Q2, we dealt with unusual circumstances and associated costs as we discontinued our business acquisition strategy and dealt with the dissident shareholder issue. With that now behind us, the new Board in place, and our costs in line, we look forward to improved contribution from our enhanced product lines and new revenue opportunities presented by our recently launched products IDC LASER™ and Digital Tattoo™", stated Frederick Godard, President and CEO, IDC.
A conference call will be held on Wednesday, September 12, 2012 at 8:30 a.m. ET to discuss this announcement. The call may be accessed by dialing 1-613-233-1979 / 1-866-696-5910 with the pass code 1746780. A taped replay will be available until September 13, 2012 at 10:00 a.m. ET by dialing 1-800-408-3053 and reference the pass code 1689868. A live audio webcast of the conference call will be available at http://www.gowebcasting.com/3817 . The webcast will be archived here for 365 days.
About International Datacasting Corporation (IDC):
International Datacasting Corporation (TSX:IDC) is a global leader in digital content distribution for the world's premiere broadcasters in radio, television and digital cinema. IDC offers a broad portfolio of advanced solutions including Pro Audio, Pro Video, Pro Cinema and Pro Data for implementing broadcast content contribution and distribution applications. IDC's solutions and IDC Systems are in demand for radio and television networks, digital cinema, 3D live events, ad insertion, satellite news gathering, sport contribution, VOD and IPTV among others. IDC is headquartered in Ottawa, Canada, with regional offices in Arnhem, the Netherlands and in San Diego, California. IDC has installations in over 100 countries and service offices in Thailand and Singapore, with an international network of value-added partners and distributors.
This release may contain forward-looking statements reflecting IDC's objectives, estimates and expectations. Such statements may be marked by the use words such as "believe", "anticipate", "estimate", "looking ahead", "outlook" and "expect" as well as the conditional or future tense. Such statements involve risks and uncertainties and future results may differ materially from the Corporation's expectations. Factors that might cause a material difference include, but are not limited to, competitive developments, risks associated with IDC's growth, risks associated with any past or future acquisitions or divestitures, the development of the satellite services market, regulatory risks, intellectual property infringement and other factors. Any forward-looking statements are provided to assist external shareholders in understanding IDC's expectations as at the date of this release and may not be suitable for other purposes. IDC assumes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof, except as expressly required by law. More detailed information about potential factors that could affect IDC's financial and business results is included in IDC's Annual Information Form dated April 30, 2012 and the other public documents IDC files from time to time with Canadian securities regulatory authorities.
Unaudited condensed consolidated financial statements and management's discussion and analysis for the three and six months ended July 31, 2012, will be available at http://www.sedar.com/ or on the Investor Information section of IDC's website at www.datacast.com.
(1) Adjusted earnings before income taxes, depreciation and amortization ("Adjusted EBITDA") is a non-GAAP financial measure. The reconciliation of Adjusted EBITDA to Net income (loss) is provided at the end of this release.