OTTAWA, May 9, 2013 /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
first quarter financial results for the three month period ended March
Completed acquisition of ANT, which further advances Espial's market
leadership in HTML5 user experience across set-top boxes and
Secured new customers including Cisco, Samsung and Humax through the
acquisition of ANT.
Signed a partnership agreement with WiLAN to pursue licensing of certain
Espial's patents related to video-over-IP technology.
Received grant of patent by the USPTO for fast channel change technology
For the three-month period ended March 31, 2013, the Company reported
revenues of $2.5 million compared with revenues of $3.7 million for the
three months ended March 31, 2012. Earnings before interest, foreign
exchange, taxes, stock compensation, depreciation and amortization
(EBITDA) for the first quarter of fiscal 2013 was a loss of $2.5
million compared with an income of $0.1 million in the first quarter of
fiscal 2012. Included in the quarter's EBITDA was a restructuring
charge of $1.1 million related to the acquisition of ANT. Net loss for
the quarter was $3.3 million or $0.23 per share, compared with a net
loss of $0.4 million last year, or $0.03 per share.
"We're pleased to close the ANT acquisition and excited to have the team
join Espial" said Jaison Dolvane, CEO, Espial. "We are now working to
integrate the companies and expect to complete this over the next 2
quarters. The acquisition of ANT provides us with a strong set of
customers and increased engineering capability to deliver an advanced
HTML5 user experience across set-top boxes and multiscreen devices. In
Q1, we also continued our initiatives to increase the depth of our
intellectual property and develop licensing programs through our
partnership with WiLAN. We believe that as service providers and Smart
TV manufacturers migrate to IP video services, Espial's products and
intellectual property are well positioned to play a key role in the
industry. Our customer pipeline remains strong and the new products we
release later this year will differentiate us further."
"As a result of the ANT acquisition closing mid-way through the quarter,
our first quarter results did not include $993,000 of revenue that
would have been included had the acquisition occurred at the beginning
of the quarter. In addition, we recorded a $1.1 million one-time
acquisition related restructuring charge" said Carl Smith, Chief
Financial Officer. "As we noted in our last two conference calls and
press releases, we continue to experience a slower pace of roll-outs
from our existing European customers. We believe this is related to the
prevailing economic challenges in Europe and may continue for some
time. Europe notwithstanding, we are seeing increased activity in
North America and Asia as those economies gain strength."
Q1 Financial Results
First quarter revenues were $2,542,059 compared with revenues of
$3,650,536 in the same period a year ago. First quarter software
license and royalty revenues were $1,389,445 compared to $1,908,236 in
the first quarter of fiscal 2012. Professional services for the first
quarters of 2013 and 2012 were $247,819 and $962,025 respectively.
Maintenance and support revenues for the first quarter were $904,795
compared to $780,275 last year.
Gross margin for the first quarter of fiscal 2013 was 78% compared with
77% in the first quarter of fiscal 2012.
Operating expenses in the first quarter of fiscal 2013 were $4,899,423
compared to $3,045,360 in the first quarter of fiscal 2012.
Earnings before interest, foreign exchange, taxes, stock compensation,
depreciation and amortization (EBITDA) for the first quarter of fiscal
2013 was a loss of $2,460,496 compared to income of $112,758 in fiscal
2012. Included in the loss was a restructuring charge of $1,049,222
related to the acquisition of ANT.
Net loss, which includes non-cash items like depreciation, goodwill and
intangibles in the first quarter was $3,272,169 compared to a loss of
$358,603 last year.
Cash and cash equivalents on March 31, 2013 was $4,912,034.
A complete set of financial statements and management's discussion and
analysis for the period ended March 31, 2013 will be available at http://www.sedar.com.
The Company will be hosting a conference call to discuss the Q1 2013
financial results on May 10, 2013 at 10:30 a.m. Eastern Time (ET). The
phone number to join the results discussion is:
Toll free line (Canada/US) - +1 888-390-0605
Toll line (international/local) - +1 416-764-8609
The playback for the call will be available until 11:59pm ET on June 9,
2013, at the following numbers and passcode:
Toll line: +1 416-764-8677, Passcode: 653198
Toll-free line: +1-888-390-0541, Passcode: 653198
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 35 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 or assumptions about, the
anticipated synergies of the ANT Plc acquisition and the integration of
ANT into the company's operations, economic conditions, benefits of new
customer and partner relationships, future opportunities for the
company and products and any other statements regarding Espial's
objectives (and strategies to achieve such objectives), future
expectations, beliefs, goals or prospects are or involve
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 known
and unknown risks and uncertainties. A number of factors could cause
actual results to differ materially from those in the forward-looking
statements or could cause our current objectives and strategies to
change, including but not limited to Espial's ability to successful
integrate ANT's operations into its existing operations, changing
conditions and other risks associated with the on-demand TV software
industry and the market segments in which Espial operates, competition,
Espial's ability to effectively develop its distribution channels and
generate increased demand for its products, economic conditions,
technological change, unanticipated changes in our costs, regulatory
changes, litigation, the emergence of new opportunities, many of which
are beyond our control and current expectation or knowledge.
Additional risks and uncertainties affecting Espial can be found in
Management's Discussion and Analysis of Results of Operations and
Financial Condition for the fiscal year ended December 31, 2012 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 and our current objectives or strategies may change.
Espial assumes no obligation to update or revise any forward looking
statements, whether as a result of new information, future events or
otherwise, except as required by law. 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:
March 31, 2013
March 31, 2012
Net loss and Comprehensive loss
Depreciation of property and equipment
Amortization of intangibles
Net interest income (expense)
Foreign exchange gain (loss)
Earnings before interest, foreign exchange, taxes,
stock compensation, depreciation and amortization
SOURCE: ESPIAL GROUP
For further information:
For inquiries from the financial press or analysts, contact:
Chief Financial Officer
Espial Group Inc.
Phone: +1 613-230-4770
Espial Group Inc.
Phone: +1-613-230-4770 x1145