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.

                                                  December 31, September 30,
                                                      2011          2012
                                                 ------------- -------------
  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
                                                 ============= =============


  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
        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.

                              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
Email Contact

Investor Relations Contact:
Michael Koehler or Matt Glover
Liolios Group, Inc.
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
Traditional on-premises data centers have long been the domain of modern data platforms like Apache Hadoop, meaning companies who build their business on public cloud were challenged to run Big Data processing and analytics at scale. But recent advancements in Hadoop performance, security, and most importantly cloud-native integrations, are giving organizations the ability to truly gain value from all their data. In his session at 19th Cloud Expo, David Tishgart, Director of Product Marketing ...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform and how we integrate our thinking to solve complicated problems. In his session at 19th Cloud Expo, Craig Sproule, CEO of Metavine, will demonstrate how to move beyond today's coding paradigm ...
Although it has gained significant traction in the consumer space, IoT is still in the early stages of adoption in enterprises environments. However, many companies are working on initiatives like Industry 4.0 that includes IoT as one of the key disruptive technologies expected to reshape businesses of tomorrow. The key challenges will be availability, robustness and reliability of networks that connect devices in a business environment. Software Defined Wide Area Network (SD-WAN) is expected to...
SYS-CON Events announced today that StarNet Communications will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. StarNet Communications’ FastX is the industry first cloud-based remote X Windows emulator. Using standard Web browsers (FireFox, Chrome, Safari, etc.) users from around the world gain highly secure access to applications and data hosted on Linux-based servers in a central data center. ...
OnProcess Technology has announced it will be a featured speaker at @ThingsExpo, taking place November 1 - 3, 2016, in Santa Clara, California. Dan Gettens, OnProcess’ Chief Analytics Officer, will discuss how Internet of Things (IoT) data can be leveraged to predict product failures, improve uptime and slash costly inventory stock. @ThingsExpo is an annual gathering of IoT and cloud developers, practitioners and thought-leaders who exchange ideas and insights on topics ranging from Big Data in...
SYS-CON Events announced today that CDS Global Cloud, an Infrastructure as a Service provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. CDS Global Cloud is an IaaS (Infrastructure as a Service) provider specializing in solutions for e-commerce, internet gaming, online education and other internet applications. With a growing number of data centers and network points around the world, ...
Developing software for the Internet of Things (IoT) comes with its own set of challenges. Security, privacy, and unified standards are a few key issues. In addition, each IoT product is comprised of (at least) three separate application components: the software embedded in the device, the back-end service, and the mobile application for the end user’s controls. Each component is developed by a different team, using different technologies and practices, and deployed to a different stack/target –...
Virgil consists of an open-source encryption library, which implements Cryptographic Message Syntax (CMS) and Elliptic Curve Integrated Encryption Scheme (ECIES) (including RSA schema), a Key Management API, and a cloud-based Key Management Service (Virgil Keys). The Virgil Keys Service consists of a public key service and a private key escrow service. 

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, will discuss the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
Big Data has been changing the world. IoT fuels the further transformation recently. How are Big Data and IoT related? In his session at @BigDataExpo, Tony Shan, a renowned visionary and thought leader, will explore the interplay of Big Data and IoT. He will anatomize Big Data and IoT separately in terms of what, which, why, where, when, who, how and how much. He will then analyze the relationship between IoT and Big Data, specifically the drilldown of how the 4Vs of Big Data (Volume, Variety,...
SYS-CON Events announced today that Tintri Inc., a leading producer of VM-aware storage (VAS) for virtualization and cloud environments, will present at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Tintri VM-aware storage is the simplest for virtualized applications and cloud. Organizations including GE, Toyota, United Healthcare, NASA and 6 of the Fortune 15 have said “No to LUNs.” With Tintri they manag...
From wearable activity trackers to fantasy e-sports, data and technology are transforming the way athletes train for the game and fans engage with their teams. In his session at @ThingsExpo, will present key data findings from leading sports organizations San Francisco 49ers, Orlando Magic NBA team. By utilizing data analytics these sports orgs have recognized new revenue streams, doubled its fan base and streamlined costs at its stadiums. John Paul is the CEO and Founder of VenueNext. Prior ...
SYS-CON Events announced today that eCube Systems, the leading provider of modern development tools and best practices for Continuous Integration on OpenVMS, will exhibit at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. eCube Systems offers a family of middleware products and development tools that maximize return on technology investment by leveraging existing technical equity to meet evolving business needs. ...
Ask someone to architect an Internet of Things (IoT) solution and you are guaranteed to see a reference to the cloud. This would lead you to believe that IoT requires the cloud to exist. However, there are many IoT use cases where the cloud is not feasible or desirable. In his session at @ThingsExpo, Dave McCarthy, Director of Products at Bsquare Corporation, will discuss the strategies that exist to extend intelligence directly to IoT devices and sensors, freeing them from the constraints of ...
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 So...