SYS-CON MEDIA Authors: Pat Romanski, Elizabeth White, PagerDuty Blog, Michael Jannery, Javier Paniza

News Feed Item

Broadcast International Reports Third Quarter 2012 Results

SALT LAKE CITY, UT -- (Marketwire) -- 11/13/12 -- Broadcast International (OTCQB: BCST) ("BI"), a leading provider of video-powered broadcast solutions, reported financial results for the third quarter ended September 30, 2012.

Q3 2012 Highlights

  • Cayman Islands-based WestStar TV selected CodecSys to provide the framework for its new Over-the-Top (OTT) service. Based on BI's CodecSys patented multi-codec compression software, the solution enables WestStar's subscribers to receive local and global content on their mobile devices.

  • Partnered with netTALK.com to provide a triple play OTT video service for netTALK's more than 1 million subscribers. netTALK TV, an extension of netTALK's Voice over Internet Protocol (VoIP) service, will bring customers a total communications and entertainment experience by permitting access to online video content via a CodecSys-enabled OTT or Video on Demand (VOD) playback service.

  • Binbit Group, a global provider of mobile entertainment services, selected CodecSys to expand its video on demand web and mobile device capabilities. CodecSys encoding and transcoding systems were installed in Binbit's Austin, Texas data center to support its regional operations.

Q3 2012 Financial Results
Revenue in the third quarter 2012 increased 2% sequentially to $2.05 million from $2.00 million in the prior quarter, and decreased 10% from $2.3 million in the same year-ago period. The year-over-year decrease was primarily due to fewer expansion sites installed for the company's largest digital signage customer, partially offset by an increase in license fees and other professional services.

Gross profit in the third quarter 2012 was $779,000 (a record since becoming publicly-traded company) or 38% of total revenue. This was an improvement from $654,000 or 33% of total revenue in the previous quarter and from $758,800 or 33% of total revenue in the same year-ago period.

Total operating expenses in the third quarter 2012 decreased 24% sequentially to $1.9 million from $2.5 million in the prior quarter, and decreased 22% from $2.4 million in Q3 2011.

Operating loss in the third quarter 2012 was $1.1 million, an improvement from an operating loss of $1.8 million in the previous quarter and an operating loss of $1.7 million in the same year-ago period. The significant decrease in operating losses is primarily due to effective cost cutting programs, along with increased gross profits that have helped to reduce the monthly burn rate by nearly 50% or $239,000.

Net loss in the third quarter 2012 totaled $711,000 or $(0.01) per basic and diluted share, compared to a net profit of $847,000 or $0.01 per basic and diluted share in the prior quarter, and compared to a net profit of $4.0 million or $0.05 per basic and diluted share in Q3 2011. The year-over-year decline was primarily due to a $4.8 million change in the fair value of the company's warrants and convertible notes.

Management Commentary
"Our third quarter results reflect our ongoing efforts to reduce expenses and drive margin expansion," said Jim Solomon, CFO of Broadcast International. "In fact, we achieved our highest-ever gross margins since becoming a publicly-traded company. We continued to see our operating expenses decrease both on a year-over-year and sequential basis, and anticipate further optimization going forward.

"As we wrap up the year and prepare for 2013, we remain focused on expanding and diversifying our BI Networks and CodecSys customer base. We are confident that over the course of 2012, we have put in place the right personnel and resources to handle the anticipated ramp-up in our business, while continuing to provide our loyal customers exceptional service and support. Our BI Networks division continues to gain traction in the financial services industry, and we remain well positioned to capitalize on the growing opportunity for CodecSys in the enterprise IP video and OTT markets, both domestically and overseas."

Earnings Podcast
Broadcast International will stream its third quarter 2012 results podcast tomorrow (Wednesday, November 14) at 9:00 a.m. Eastern time. The video podcast will be available via the Investor Relations section of the company's website at www.brin.com.

Broadcast International management will discuss the company's financial results, and provide an operational update and outlook for the remainder of 2012.

Date: Wednesday, November 14, 2012
Time: 9:00 a.m. Eastern time (7:00 a.m. Mountain time)
Podcast: www.brin.com/news/podcast-new

If you have any difficulty connecting with the podcast, please contact Liolios Group at 1-949-574-3860.

About Broadcast International
Broadcast International is a leading provider of video-powered broadcast solutions, including IP, digital satellite, Internet streaming and other types of wired/wireless network distribution. BI's patented CodecSys software is a breakthrough, multi-codec video compression technology that cuts video bandwidth requirements over satellite, cable, IP and wireless networks. By slashing bandwidth needs, CodecSys enables a new generation of rich-media applications and offers unprecedented price/ performance benefits for existing applications. Broadcast International is a public company (OTCQB: BCST) headquartered in Salt Lake City, UT.

For more information visit: www.brin.com and www.codecsys.com.

Forward Looking Statements
All statements in this news release that are not based on historical fact are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). While management has based any forward-looking statements contained herein on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties, and other factors, many of which are outside of our control, that could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not necessarily limited to, those set forth under the caption "Additional Factors That May Affect Our Business" in the Company's most recent Form 10-K and 10-Q filings, and amendments thereto. In addition, we operate in a highly competitive and rapidly changing environment, and new risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. We disclaim any intention to, and undertake no obligation to, update or revise any forward-looking statement.


                        BROADCAST INTERNATIONAL, INC.
                    CONDENSED CONSOLIDATED BALANCE SHEETS

                                                  December 31, September 30,
                                                      2011          2012
                                                 ------------- -------------
                                                                (Unaudited)
ASSETS:
  Current Assets
    Cash                                         $     961,265 $     373,119
    Trade accounts receivable, net                   1,239,903     1,161,101
    Inventory                                           60,851       362,335
    Prepaid expenses                                   203,973       178,008
                                                 ------------- -------------
    Total current assets                             2,465,992     2,074,563
                                                 ------------- -------------
  Property and equipment, net                        1,417,134       664,750
                                                 ------------- -------------
  Other Assets, non current
    Debt offering costs                                123,278        61,643
    Patents, net                                       131,079       123,466
    Deposits and other assets                          406,004       226,794
                                                 ------------- -------------
    Total other assets, non current                    660,361       411,903
                                                 ------------- -------------

  Total assets                                   $   4,543,487 $   3,151,216
                                                 ============= =============

LIABILITIES AND STOCKHOLDERS DEFICIT:

  Current Liabilities
    Accounts payable                             $   1,252,538 $   2,002,821
    Payroll and related expenses                       390,206       329,203
    Other accrued expenses                             175,008       221,031
    Unearned revenue                                    10,449        30,521
      Current portion of notes payable (net of
       discount of $103,859 and $861,335,
       respectively)                                 2,068,016     1,938,665
    Other current obligations                        1,067,649            --
    Derivative valuation                             3,760,200     4,346,021
                                                 ------------- -------------
    Total current liabilities                        8,724,066     8,868,262
                                                 ------------- -------------
  Long-term Liabilities
      Long-term portion of notes payable (net of
       discount of $659,496 and $409,494,
       respectively)                                 6,349,445       590,506
                                                 ------------- -------------
    Total long-term liabilities                      6,349,445       590,506
                                                 ------------- -------------
  Total liabilities                                 15,073,511     9,458,768
                                                 ------------- -------------
  Commitments and contingencies
  STOCKHOLDERS' DEFICIT:
        Preferred stock, no par value,
         20,000,000 shares authorized; none
         issued                                             --            --
        Common stock, $.05 par value,
         180,000,000 shares authorized;
         75,975,656 and 107,405,328 shares
         issued as of December 31, 2011 and
         September 30, 2012, respectively            3,798,783     5,370,266
    Additional paid-in capital                      96,859,058    99,559,404
    Accumulated deficit                           -111,187,865  -111,237,222
                                                 ------------- -------------
    Total stockholders' deficit                    -10,530,024    -6,307,552
                                                 ------------- -------------

  Total liabilities and stockholders' deficit    $   4,543,487 $   3,151,216
                                                 ============= =============



                        BROADCAST INTERNATIONAL, INC.
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (Unaudited)

                              For the three months     For the nine months
                                      ended                   ended
                                  September 30,           September 30,
                            ------------------------ -----------------------
                                2011        2012         2011        2012
                            ----------- ------------ ----------- -----------

Net sales                   $ 2,277,074 $  2,045,278 $ 6,321,495 $ 5,790,363
Cost of sales                 1,518,310    1,266,224   4,414,402   3,857,682
                            ----------- ------------ ----------- -----------
Gross profit                    758,764      779,054   1,907,093   1,932,681
                            ----------- ------------ ----------- -----------

Operating expenses:
  Administrative and
   general                    1,280,183    1,001,001   5,124,883   3,589,602
  Selling and marketing         401,826      442,495     824,771   1,557,735
  Research and development      570,197      325,126   1,793,596   1,346,540
  Depreciation and
   amortization                 169,592      127,334     517,751     454,009
                            ----------- ------------ ----------- -----------
  Total operating expenses    2,421,798    1,895,956   8,261,001   6,947,886
                            ----------- ------------ ----------- -----------
Total operating loss         -1,663,034   -1,116,902  -6,353,908  -5,015,205
                            ----------- ------------ ----------- -----------

Other income:
  Interest income                   338           --       2,324           1
  Interest expense             -176,047     -460,388    -745,925  -1,066,599
  Gain (loss) on derivative
   valuation                  5,851,300    1,051,516  12,257,500   5,639,996
  Equity issuance costs
   related to warrants               --           --    -476,234  -1,095,309
  Loss on note conversion
   offering expense                  --      -47,348          --     -47,348
  Gain (loss) on
   extinguishment of debt        16,000      -83,754    -954,033   1,588,821
  Loss on retirement of
   debt offering costs               --      -53,150          --     -53,150
  Gain (loss) on sale of
   assets                            --        2,421        -362         781
  Other income (expense),
   net                            5,597       -3,467         151      -1,345
                            ----------- ------------ ----------- -----------
  Total other income          5,697,188      405,830  10,083,421   4,965,848
                            ----------- ------------ ----------- -----------

Profit (loss) before income
 taxes                        4,034,154     -711,072   3,729,513     -49,357
Provision for income taxes           --           --          --          --
                            ----------- ------------ ----------- -----------
Net profit (loss)           $ 4,034,154 $   -711,072 $ 3,729,513     -49,357
                            =========== ============ =========== ===========

Net profit (loss) per share
 - basic                    $      0.05 $      -0.01 $      0.05           0
                            =========== ============ =========== ===========
Net profit (loss) per share
 - diluted                  $      0.05 $      -0.01 $      0.05           0
                            =========== ============ =========== ===========

Weighted average shares -
 basic                       75,844,526  107,263,073  75,240,313  98,564,531
                            =========== ============ =========== ===========
Weighted average shares -
 diluted                     78,414,453  107,263,073  77,970,216  98,564,531
                            =========== ============ =========== ===========

Add to Digg Bookmark with del.icio.us Add to Newsvine

Company Contact:
Cameron Francis
Vice President Products
Broadcast International
801-562-2252
Email Contact

Investor Relations Contact:
Michael Koehler or Matt Glover
Liolios Group, Inc.
949-574-3860
Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
The Internet of Things is tied together with a thin strand that is known as time. Coincidentally, at the core of nearly all data analytics is a timestamp. When working with time series data there are a few core principles that everyone should consider, especially across datasets where time is the common boundary. In his session at Internet of @ThingsExpo, Jim Scott, Director of Enterprise Strategy & Architecture at MapR Technologies, discussed single-value, geo-spatial, and log time series dat...
The industrial software market has treated data with the mentality of “collect everything now, worry about how to use it later.” We now find ourselves buried in data, with the pervasive connectivity of the (Industrial) Internet of Things only piling on more numbers. There’s too much data and not enough information. In his session at @ThingsExpo, Bob Gates, Global Marketing Director, GE’s Intelligent Platforms business, to discuss how realizing the power of IoT, software developers are now focu...
Cultural, regulatory, environmental, political and economic (CREPE) conditions over the past decade are creating cross-industry solution spaces that require processes and technologies from both the Internet of Things (IoT), and Data Management and Analytics (DMA). These solution spaces are evolving into Sensor Analytics Ecosystems (SAE) that represent significant new opportunities for organizations of all types. Public Utilities throughout the world, providing electricity, natural gas and water,...
In her General Session at 15th Cloud Expo, Anne Plese, Senior Consultant, Cloud Product Marketing, at Verizon Enterprise, focused on finding the right mix of renting vs. buying Oracle capacity to scale to meet business demands, and offer validated Oracle database TCO models for Oracle development and testing environments. Anne Plese is a marketing and technology enthusiast/realist with over 19+ years in high tech. At Verizon Enterprise, she focuses on driving growth for the Verizon Cloud platfo...
Between the compelling mockups and specs produced by your analysts and designers, and the resulting application built by your developers, there is a gulf where projects fail, costs spiral out of control, and applications fall short of requirements. In his session at DevOps Summit, Charles Kendrick, CTO and Chief Architect at Isomorphic Software, will present a new approach where business and development users collaborate – each using tools appropriate to their goals and expertise – to build mo...
There is no doubt that Big Data is here and getting bigger every day. Building a Big Data infrastructure today is no easy task. There are an enormous number of choices for database engines and technologies. To make things even more challenging, requirements are getting more sophisticated, and the standard paradigm of supporting historical analytics queries is often just one facet of what is needed. As Big Data growth continues, organizations are demanding real-time access to data, allowing immed...
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using ...
15th Cloud Expo, which took place Nov. 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA, expanded the conference content of @ThingsExpo, Big Data Expo, and DevOps Summit to include two developer events. IBM held a Bluemix Developer Playground on November 5 and ElasticBox held a Hackathon on November 6. Both events took place on the expo floor. The Bluemix Developer Playground, for developers of all levels, highlighted the ease of use of Bluemix, its services and functionalit...
"ElasticBox is an enterprise company that makes it very easy for developers and IT ops to collaborate to develop, build and deploy applications on any cloud - private, public or hybrid," stated Monish Sharma, VP of Customer Success at ElasticBox, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
"For the past 4 years we have been working mainly to export. For the last 3 or 4 years the main market was Russia. In the past year we have been working to expand our footprint in Europe and the United States," explained Andris Gailitis, CEO of DEAC, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
The Industrial Internet revolution is now underway, enabled by connected machines and billions of devices that communicate and collaborate. The massive amounts of Big Data requiring real-time analysis is flooding legacy IT systems and giving way to cloud environments that can handle the unpredictable workloads. Yet many barriers remain until we can fully realize the opportunities and benefits from the convergence of machines and devices with Big Data and the cloud, including interoperability, ...
At 15th Cloud Expo, Shrikant Pattathil, Executive Vice President at Harbinger Systems, demos a video delivery platform that helps you do interactive videos. He discusses how Harbinger is accomplishing it in the cloud world, the problems they faced and the choices they made to get around these problems.
“DevOps is really about the business. The business is under pressure today, competitively in the marketplace to respond to the expectations of the customer. The business is driving IT and the problem is that IT isn't responding fast enough," explained Mark Levy, Senior Product Marketing Manager at Serena Software, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
“The year of the cloud – we have no idea when it's really happening but we think it's happening now. For those technology providers like Zentera that are helping enterprises move to the cloud - it's been fun to watch," noted Mike Loftus, VP Product Management and Marketing at Zentera Systems, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.