Broadcast International Makes $8M, Loses $8M
March 30, 2012 by Dave Haynes
Utah-based Broadcast International has been around the digital signage space for a few years but not been all that embedded in it, also marketing video compression technology I remember getting demo’d on a cell phone going back maybe five years.
The company was at Digital Signage Expo with a fairly substantial stand and pitch about their “first of its kind” solution for banks that didn’t seem all that new or different from the mob. Taking print material and making it digital is hardly a genius moment in 2012.
DSE was the first time I had seen them for a while, but they have a PR firm now carpet-bombing me with news – including the latest financials.
Like Wireless Ronin, the company has the mixed blessing of being able to raise investor money off the market but having to also report back to investors on how it is performing. In this case, not so great.
Revenues for the full year 2011 were up 15% to $8.4 million. The improvement was primarily due to expanded installation of digital signage systems with the company’s largest customer, which I am pretty sure is Bank of America.
Operating loss for the full year was $8.0 million, versus $5.7 million in 2010. The increase was primarily due to CodecSys sales and marketing, contract labor as well as non-cash stock-based compensation which accounted for more than half of the increase.
The company closed a $6.95 million private placement a couple of weeks ago to fund the company’s growth initiatives and retire senior long-term debt at discount to par. That left $2.5 million of what I guess you’d call working capital.
“2011 marked our third consecutive year of revenue growth, driven by the continued rollout of our digital signage solutions,” said Rod Tiede, Broadcast International’s CEO. “However, during the year we also made tremendous progress with our new flagship product, CodecSys, culminating in the fourth quarter with our first CodecSys OTT installation. This launch with Multicable propelled us into a new, hugely expansive and fast-growing market for IP video delivery.
“This achievement reflects how we have strengthened our CodecSys marketing efforts, including establishing new channel partnerships with key industry players, including Fujitsu in Q4 and more recently Vivicast. In fact, Fujitsu has made CodecSys such an integral part of its video compression solution that it has trained over 200 people in its global sales channels. Our first purchase order from Fujitsu is imminent as the response has been tremendous.
“As we advance through the beginning of 2012, we are encouraged by the continued growth of our BI Networks and our expanding CodecSys customer base, especially our recent CodecSys OTT win with TeleCable. All of our BI Network solutions now use our CodecSys technology to optimize content delivery and storage, providing the end user high quality video content with minimal bandwidth. This includes Zions Bank, who recently chose us to provide its customer’s an engaging digital marketing and merchandising network.
“Our recent capital raise of nearly $7 million allowed us to strengthen our balance sheet and provides the resources for us to pursue large scale rollouts for both CodecSys and BI Networks, and capitalize on two rapidly growing industries. We are confident our technologies will continue to be adopted worldwide and driving new customer wins through the year.”