Espial Reports 2012 Second Quarter Results

OTTAWA, Aug. 9, 2012 /CNW/ - Espial® Group Inc. ("Espial" or the "Company"), (TSX: ESP), a leader in the delivery of on-demand TV software and services, today announced its second quarter financial results for the three-month period ended June 30, 2012.

Espial Highlights

  • Q2 2012 revenue of $3.8 million with EBITDA of $0.2 million.
  • Espial TV Browser selected to power new Sharp® AQUOS® LED TVs
  • Smart TVs from Hitachi, Toshiba and Sharp - powered by the Espial TV Browser - began shipping to retail stores in several regions across the world.
  • Com Hem, the largest cable operator in Scandinavia, launched DVR services using hybrid-IP cable STBs powered by the Espial Media Service Platform.
  • Continued to deliver solid expansion revenue from Espial's major cable operators in Europe and Asia.
  • Espial executives presented at important industry events including the Smart TV Summit in San Francisco, the Web Video Conference in Montreal and the Connected TV Summit in London, UK.

For the three-month period ended June 30, 2012, the Company reported revenues of $3.8 million compared with revenues of $3.8 million for the three months ended June 30, 2011. Earnings before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) for the second quarter of fiscal 2012 was $233,646 compared with earnings of $29,828 in the second quarter of fiscal 2011. Net loss for the quarter was $0.3 million or $0.02 per share, compared with a net loss of $0.5 million last year, or $0.04 per share.

"We demonstrated another positive EBITDA quarter in Q2, 2012" said Jaison Dolvane, President and CEO. "This quarter we experienced solid expansion orders from our existing pay-TV operator customers as they continue to roll out their next generation of TV services. We also saw our Smart TV customers, like Sharp, start shipping their 2012 models of Espial powered Smart TVs.  Our products continue to be of strong interest to our cable, telecom and consumer electronics customers looking to roll-out HTML5 user experiences and IP services across set-top boxes, Smart TVs, mobile phones, tablets, PCs and gaming consoles."

Q2 Financial Results

  • Revenue for the second quarter of fiscal 2012 was $3,842,525 compared with revenues of $3,821,933 in the same period a year ago. Second quarter software license and royalty revenues were $2,186,765 compared with software license and royalty revenues of $2,160,938 in the second quarter of fiscal 2011. Professional services revenue for the second quarters of 2012 and 2011 were $742,191 and $882,406 respectively.  Maintenance and support revenues for the second quarter were $913,569 compared with $778,589 last year.
  • Gross margin for the second quarter of fiscal 2012 was 79 percent compared with 76 percent in the second quarter of fiscal 2011.
  • Operating expenses for the second quarter of fiscal 2012 were $3,154,572 compared with $3,326,919 in the second quarter of fiscal 2011.
  • Earnings for the second quarter of fiscal 2012 before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) was $233,646 compared with earnings of $29,828 in the second quarter of fiscal 2011.
  • Net loss in the second quarter was $296,533 compared with a loss of $506,493 last year.
  • Cash and cash equivalents on June 30, 2012, was $10,210,322.

A complete set of financial statements and management's discussion and analysis for the period ended June 30, 2012, will be available at http://www.sedar.com.

Conference Call

The Company will be hosting a conference call to discuss the second quarter  2012 results on August 9, 2012 at 5:00 p.m. Eastern Standard Time (EST). The phone number to join the results discussion is:

  • Toll free line  (Canada/US) -  +1 888-231-8191
  • Toll line (international/local) - +1 647-427-7450

The playback for the call will be available until 11:59pm EST on September 7, 2012, at the following numbers and passcode:

  • Toll line: +1 416-849-0833, Passcode: 16417811
  • Toll-free line: +1-855-859-2056, Passcode: 16417811

About Espial (www.espial.com)

Espial is a leading supplier of digital TV and IPTV software and solutions to cable MSOs and telecommunications operators as well as consumer electronics manufacturers. Espial's middleware, video-on-demand, and browser products power a diverse range of pay-TV and Internet TV business models. Over 10 million licenses of its patented software are in use across the world. Espial is headquartered in Ottawa, Canada and has offices in the United States, Europe, and Asia. Visit www.espial.com or contact us via phone at +1 613 230 4770.

Forward Looking Statement

This press release contains information that is forward looking information with respect to Espial within the meaning of Section 138.4(9) of the Ontario Securities Act (forward looking statements) and other applicable securities laws. In some cases, forward-looking information can be identified by the use of terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or the negative of these terms or other similar expressions concerning matters that are not historical facts. In particular, statements about anticipated benefits of new customer and partner relationships, future opportunities for the company and products and any other statements regarding Espial's future expectations, beliefs, goals or prospects are or involve forward-looking information.

Forward-looking information is based on certain factors and assumptions.  While the company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward-looking information, by its nature necessarily involves risks and uncertainties, including Espial's ability to effectively develop its distribution channels, and generate increased demand for its products.  Additional risks and uncertainties affecting Espial can be found in Espial's Annual Report for the fiscal year ended December 31, 2011 and in its most recent quarterly report filed on SEDAR at www.sedar.com. If any of these risks or uncertainties were to materialize, or if the factors and assumptions underlying the forward-looking information were to prove incorrect, actual results could vary materially from those that are expressed or implied by the forward-looking information contained herein.  Espial assumes no obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

Non-IFRS Financial Measures
Earnings before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) is a non-IFRS financial measure that does not have any prescribed meaning by IFRS and is therefore unlikely to be comparable to similar measures presented by other issuers.  Management believes that this non-IFRS financial measure, when taken together with the corresponding consolidated IFRS measures, increases the transparency of the Company's current results and enables investors to more fully understand trends in its current and future performance. A reconciliation of net loss to earnings before interest, foreign exchange, taxes, stock compensation, dividends on redeemable preferred shares, depreciation and amortization is as follows:

  June 30, 2012 June 30, 2011
  (3 months) (3 months)
  (unaudited) (unaudited)
     
Net loss and Comprehensive loss $(296,533) $(506,493)
Add    
  Stock compensation 32,686 110,663
  Depreciation of property and equipment 45,896 50,377
Amortization of intangibles 286,785 286,122
  68,834 (59,331)
Less (add)    
Net interest income (expense) (112,859) (119,585)
Foreign exchange gain (loss) (51,953) 30,426
Earnings before interest, foreign exchange, taxes, stock
compensation,  depreciation and amortization
$233,646 $29,828

 

SOURCE ESPIAL GROUP



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