|By Business Wire||
|November 9, 2012 06:36 AM EST||
Ballantyne Strong, Inc. (NYSE MKT: BTN):
|Conference call:||Today - Friday, November 9, 2012 at 10:00 AM ET|
|Webcast / Replay URL:|
|The replay will be available on the Internet for 30 days.|
|Dial-in number:||(800) 381-7839 (no pass code required)|
Ballantyne Strong, Inc. (NYSE MKT: BTN), a provider of digital cinema projection equipment, screens and services as well as specialty lighting equipment, today reported financial results for the third quarter ended September 30, 2012.
Commenting on the Company’s operating results, President and CEO Gary L. Cavey stated,
“Net revenues for the third quarter came in at $39.3 million, down 38% from a year ago when Ballantyne achieved an all-time record as a result of a significant digital cinema deployment. The diluted loss per share of $0.02 compared to net earnings of $0.33 per share in the record-setting Q3 ’11.
“Third quarter results reflect the recent industry pricing pressure related to the advanced stage of the domestic digital system rollout, putting pressure on margins for equipment resellers. We are actively focused on expanding into complementary opportunities that build upon our competencies. Ballantyne’s reputation as a customer-focused service provider with an 80-year track record of success is evidence of the Company’s ability to transition to new markets and technologies. Our strong balance sheet and strategic focus positions us for future growth.
“Ballantyne’s year-over-year comparisons reflect the record revenue and bottom-line net income numbers generated in last year’s third quarter when our cinema services group successfully completed the Marcus Theatres digital rollout of more than 550 projection systems in an unprecedented 45-day period.
“We remain focused on further leveraging our strong industry position, technological expertise and customer service orientation as we transition Ballantyne from its recent successes in the cinema industry’s widespread adoption of the digital platform. Our mid-term goal is to achieve sustainable and more predictable performance derived from a larger recurring revenue base in areas such as service. We are optimistic that with the stability of the Company’s healthy balance sheet, including $36.8 million in cash and no long-term debt, and our continued emphasis on achieving operational efficiency, Ballantyne remains well positioned to generate continued success over the next phase of our corporate evolution.”
Third Quarter Highlights
- Strong Lighting has been awarded the prestigious World Trade Center lighting contract to produce the world’s first high-powered LED beacon light.
- The state-of-the-art Network Operations Center (NOC) continues to achieve substantial growth, delivering a 250% increase from the year ago period.
- Ballantyne captured one of the largest digital equipment sales in Latin America.
Third Quarter Results
Ballantyne Strong’s total net revenues decreased 38% to $39.3 million versus $63.4 million for Q3 ’11. The decrease was largely due to the challenging comparison to the record-setting prior-year period.
Digital cinema products accounted for $30.6 million of the Company’s total sales during the period compared to $54.0 million in the year ago quarter. As mentioned above, the decrease was largely due to the challenging comparison to the prior-year period although the decline was more pronounced as the Virtual Print Free (VPF) providers extended their installation deadlines, some as far out as April of next year, as long as an exhibitor is signed up for a given program. BTN continues to leverage its worldwide relationships with exhibitors and has captured a digital deployment contract from one of the largest cinema chains in Latin America, with delivery scheduled for Q4 and early 2013. In addition, a focused sales effort on the remaining U.S. projector market has also contributed to steady sales from the smaller to mid-sized exhibitors.
Cinema service revenue of $4.3 million declined 7.4% as compared to $4.6 million in Q3 ’11. The decrease was due to the substantial installation revenue recognized the prior year, which was partially offset with growth in the service and Network Operations Center (NOC) 24/7 monitoring businesses. Sales growth in service and NOC monitoring, when compared to the year-ago quarter, increased approximately 25% and 250%, respectively.
The Company’s cinema screen business generated sales of $3.0 million during the quarter, 24% higher than the year-ago level, reflecting a significant increase in large format screen sales as well as continued international screen sales growth.
The specialty lighting business generated quarterly sales of $0.8 million, up from $0.7 million a year ago. The slight increase was a result of ongoing efforts to support and grow this business with an array of LED-focused products. We were recently awarded the World Trade Center lighting contract to produce the world’s first high-powered LED beacon light based on its proprietary LED Solutions technology. The Company also secured a contract to provide the architectural lighting for the antenna of the World Trade Center.
Gross profit was $3.7 million, down 63% from $10.1 million a year ago. The reduced volume, as discussed previously, impacted gross profit by $3.9 million with the remaining $2.5 million shortfall associated with competitive pressures within the digital equipment market, lower margin sales on international business and reduced leverage on fixed costs due to the lower Q3 sales volume.
SG&A expenses were relatively flat at $3.7 million versus $3.5 million in the prior-year period. The Company continues to exercise expense discipline to ensure spending is allocated in-line with business trends and the ongoing transformation of its business, including the expansion of its global products and services re-focus, as announced in early 2012.
The Company reported a net loss for the quarter of $0.3 million, or $0.02 per diluted share, compared to net income of $4.7 million, or $0.33 per diluted share in Q3 ’12.
Net revenues for the nine months ended September 30, 2012 decreased approximately 2% to $130.0 million, compared to the first nine months of 2011, leading to a gross profit of $16.4 million, or 13% of net revenues, compared to gross profit of $22.9 million, or 17.2% of net revenues in the comparable prior-year period. Net earnings were $4.0 million, or $0.28 per diluted share, compared to net earnings of $8.7 million, or $0.60 per diluted share in the first nine months of 2011.
Balance Sheet and Cash Flow Update
Ballantyne’s cash and cash equivalents balance at quarter-end was $36.8 million, up from $35.9 million at the end of Q2 ’12.
About Ballantyne Strong, Inc. (www.strong-world.com)
Ballantyne Strong is a provider of digital cinema projection equipment, screens and services as well as specialty lighting equipment. The Company supplies major and independent theater chains, top arenas, theme parks and architectural sites around the world.
Except for the historical information in this press release, it includes forward-looking statements that involve risks and uncertainties, including but not limited to, quarterly fluctuations in results; customer demand for the Company’s products; the development of new technology for alternate means of motion picture presentation; domestic and international economic conditions; the management of growth; and other risks detailed from time to time in the Company’s Securities and Exchange Commission filings. Actual results may differ materially from management’s expectations.
Ballantyne Strong, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
Three and Nine Months Ended September 30, 2012 and 2011
Three Months Ended
Nine Months Ended
|Cost of revenues||35,539||53,387||113,569||110,019|
|Selling and administrative expenses:|
|Total selling and administrative expenses||3,694||3,476||11,952||7,473|
|Gain (loss) on the sale/disposal/transfer of assets||(17||)||13||1,361||36|
|Income from operations||10||6,587||5,827||12,526|
|Net interest expense||(8||)||(12||)||(30||)||(38||)|
|Equity in income (loss) of joint venture||(65||)||207||1||(121||)|
|Other income (expense), net||(205||)||127||208||48|
|Income before income taxes||(268||)||6,909||6,006||12,415|
|Income tax expense||--||(2,170||)||(2,024||)||(3,683||)|
|Basic earnings per share||$||(0.02||)||$||0.33||$||0.28||$||0.61|
|Diluted earnings per share||$||(0.02||)||$||0.33||$||0.28||$||0.60|
|Weighted average shares outstanding:|
Ballantyne Strong, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30, 2012 and December 31, 2011
|Cash and cash equivalents||$||36,763||$||39,889|
|Accounts receivable (net of allowance)||26,091||30,579|
|Other current assets||6,380||8,446|
|Total current assets||83,760||96,420|
|Investment in joint venture||
|Property, plant and equipment (net of accumulated depreciation)||10,586||9,419|
|Property held for sale||
|Other non-current assets||2,311||1,896|
|Liabilities and Stockholders’ Equity|
|Other accrued expenses||4,249||4,820|
|Customer deposits/deferred revenue||4,697||5,037|
|Income tax payable||
|Total current liabilities||28,909||45,916|
|Other non-current liabilities||1,286||748|
Preferred stock, par value $.01 per share; Authorized 1,000 shares,
Common stock, par value $.01 per share; Authorized 25,000
|Additional paid-in capital||37,658||37,234|
|Accumulated other comprehensive income:|
|Foreign currency translation||435||(137||)|
|Minimum pension liability||81||81|
Less 2,713 and 2,155 of common shares in treasury, at cost at
|Total stockholders’ equity||65,477||63,223|
|Total liabilities and stockholders’ equity||$||98,874||$||113,456|
Ballantyne Strong, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
Nine Months Ended September 30, 2012 and 2011
Nine Months Ended
|Net cash (used in) operating activities||$||(5,346||)||$||(183||)|
|Cash flows from investing activities:|
|Return of investment from Joint Venture||1,849||—|
|Excess distribution of investment from Joint Venture||659||—|
|Proceeds from sale of assets||3,332||47|
|Net cash provided by (used in) investing activities||4,745||(2,389||)|
|Cash flows from financing activities:|
|Purchase of treasury stock||(2,756||)||—|
|Proceeds from exercise of stock options||—||177|
|Excess tax benefits from share-based compensation||—||301|
|Proceeds from employee stock purchase plan||—||164|
|Net cash (used in) provided by financing activities||(2,756||)||642|
|Effect of exchange rate changes on cash and cash equivalents||231||(373||)|
|Net (decrease) increase in cash and cash equivalents||(3,126||)||194|
|Cash and cash equivalents at beginning of period||39,889||22,250|
|Cash and cash equivalents at end of period||$||36,763||$||22,444|
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
Dec. 8, 2016 01:00 AM EST Reads: 3,952
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
Dec. 8, 2016 12:30 AM EST Reads: 1,102
The Internet of Things (IoT) promises to simplify and streamline our lives by automating routine tasks that distract us from our goals. This promise is based on the ubiquitous deployment of smart, connected devices that link everything from industrial control systems to automobiles to refrigerators. Unfortunately, comparatively few of the devices currently deployed have been developed with an eye toward security, and as the DDoS attacks of late October 2016 have demonstrated, this oversight can ...
Dec. 8, 2016 12:15 AM EST Reads: 1,324
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 7, 2016 11:45 PM EST Reads: 995
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
Dec. 7, 2016 10:30 PM EST Reads: 847
"Once customers get a year into their IoT deployments, they start to realize that they may have been shortsighted in the ways they built out their deployment and the key thing I see a lot of people looking at is - how can I take equipment data, pull it back in an IoT solution and show it in a dashboard," stated Dave McCarthy, Director of Products at Bsquare Corporation, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 7, 2016 10:00 PM EST Reads: 1,192
In his session at Cloud Expo, Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, provideed economic scenarios that describe how the rapid adoption of software-defined everything including cloud services, SDDC and open networking will change GDP, industry growth, productivity and jobs. This session also included a drill down for several industries such as finance, social media, cloud service providers and pharmaceuticals.
Dec. 7, 2016 09:15 PM EST Reads: 368
In IT, we sometimes coin terms for things before we know exactly what they are and how they’ll be used. The resulting terms may capture a common set of aspirations and goals – as “cloud” did broadly for on-demand, self-service, and flexible computing. But such a term can also lump together diverse and even competing practices, technologies, and priorities to the point where important distinctions are glossed over and lost.
Dec. 7, 2016 08:45 PM EST Reads: 1,633
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
Dec. 7, 2016 08:15 PM EST Reads: 2,211
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of Soli...
Dec. 7, 2016 07:15 PM EST Reads: 1,804
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
Dec. 7, 2016 07:15 PM EST Reads: 416
SYS-CON Events announced today that Dataloop.IO, an innovator in cloud IT-monitoring whose products help organizations save time and money, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Dataloop.IO is an emerging software company on the cutting edge of major IT-infrastructure trends including cloud computing and microservices. The company, founded in the UK but now based in San Fran...
Dec. 7, 2016 07:00 PM EST Reads: 487
In his session at 19th Cloud Expo, Claude Remillard, Principal Program Manager in Developer Division at Microsoft, contrasted how his team used config as code and immutable patterns for continuous delivery of microservices and apps to the cloud. He showed how the immutable patterns helps developers do away with most of the complexity of config as code-enabling scenarios such as rollback, zero downtime upgrades with far greater simplicity. He also demoed building immutable pipelines in the cloud ...
Dec. 7, 2016 06:00 PM EST Reads: 1,874
Join Impiger for their featured webinar: ‘Cloud Computing: A Roadmap to Modern Software Delivery’ on November 10, 2016, at 12:00 pm CST. Very few companies have not experienced some impact to their IT delivery due to the evolution of cloud computing. This webinar is not about deciding whether you should entertain moving some or all of your IT to the cloud, but rather, a detailed look under the hood to help IT professionals understand how cloud adoption has evolved and what trends will impact th...
Dec. 7, 2016 06:00 PM EST Reads: 2,669
"We are the public cloud providers. We are currently providing 50% of the resources they need for doing e-commerce business in China and we are hosting about 60% of mobile gaming in China," explained Yi Zheng, CPO and VP of Engineering at CDS Global Cloud, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 7, 2016 05:45 PM EST Reads: 1,107