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Press release from Marketwire

Miranda Reports First Quarter 2012 Results

Friday, May 11, 2012

Miranda Reports First Quarter 2012 Results06:00 EDT Friday, May 11, 2012MONTREAL, QUEBEC--(Marketwire - May 11, 2012) - Miranda Technologies Inc. (TSX:MT), a worldwide provider of infrastructure, playout and monitoring systems for the television broadcast, cable, satellite and IPTV industry, today reported results for the first quarter ended March 31, 2012.Financial Highlights: Q1 2012 versus Q1 2011Revenues up 7% to $42.2 million Gross profit as a percent of sales at 61%, up from 60% in 2011 Net profit of $0.9 million, compared to $2.3 million and adjusted net profit1 of $3.2 million, compared to $1.9 million last year EBITDA1 of $3.9 million versus $5.5 million and adjusted EBITDA1 of $6.8 million, versus $5.8 million in 2011 Generated operating cash flows of $5.6 million, up from $4.9 million last year First quarter revenues totalled $42.4 million, up 7% over 2011. Gross profit remained strong, coming in at 61% of sales. Quarterly EBITDA was $3.9 million or 9% of sales, versus $5.5 million and 14% of sales in the prior year. Quarterly net profit was $0.9 million or 4 cents per fully diluted share, down from $2.3 million and 11 cents respectively in 2011. Adjusted fully diluted earnings per share1 were 15 cents, compared to 9 cents in 2011. Operating activities generated $5.6 million of cash flows during the quarter, resulting in cash and cash equivalents of $36.6 million, up from $31.4 million as at December 31, 2011.1 EBITDA, adjusted EBITDA, adjusted net profit and adjusted earnings per share (EPS) are adjusted non -IFRS financial measures. See section titled "Non-IFRS Financial Measures" which follows for comments and reconciliations."We continue to benefit from our industry leading solutions, solid foundation and sound business execution, once again delivering steady revenue growth and strong adjusted net profitability" highlighted Strath Goodship, Miranda's President and Chief Executive Officer. "We are encouraged by the interest and demand for our traditional and new products and we believe that this will continue to have a positive impact on our business."Other Highlights"In April, Miranda exhibited at the National Association of Broadcasters (NAB) event in Las Vegas," highlighted Mr. Goodship. "We received a good response for our expanded portfolio of integrated offerings, reflecting our strengthening competitive position. This year, we showcased our solutions to build efficient, scalable workflows that enable broadcasters to cost effectively operate and develop new revenue streams."Miranda's exhibition booth featured solutions addressing some of broadcasters key concerns including loudness monitoring and correction, signal management and processing, automated content versioning for Video On Demand (VOD) assets and graphics capabilities integrated with traditional and automated playout.Miranda received two industry awards at NAB, including the Broadcast Engineering Magazine's "Pick Hit" award for the company's new LUMO high-density fiber converter series, along with TV Technology Magazine's "STAR" (Superior Technology Award Recipient) Award for Miranda's iTX Master Control solution.Year-over-year quarterly operating review: Q1 2012 versus Q1 2011RevenueRevenue totalled $42.4 million for the quarter, up 7% over 2011, or 6% on a constant currency basis. Growth was driven by higher sales in most geographies, with the United States, the United Kingdom and Other Countries growing by 8%, 64% and 3% respectively, while sales in Canada were down 40%. Canada, the United States, the United Kingdom and Other Countries generated 5%, 33%, 16% and 46% of quarterly sales respectively.Recently, the Company announced a key sale to provide product solutions for NBC Olympics production of the 2012 London Games. Other notable recent sales wins include Al Kass TV (Qatar), Arqiva (UK), Astro (Malaysia), DirecTV (USA), Discovery (USA), France TV (France), Hunan TV (China), Okno TV (Russia), TV Globo (Brazil).Gross ProfitGross profit as a percentage of sales was 61%, up from 60% last year. The increase over 2011 was due to pricing, product and customer mix.Operating ExpensesSelling, General & Administrative expenses (SG&A) were $16.5 million for the quarter, versus $15.1 million in 2011. The increase was largely due to $0.8 million of additional expenses related to special projects, including the Company's current review of strategic initiatives, along with higher selling expenses. SG&A as a percentage of sales was 39%, up from 38% last year. SG&A as a percentage of sales was 37%, excluding fees associated with special projects.Research and Development (R&D) expenses before tax credits were $7.4 million or 17% of sales, compared to $7.6 million and 19% last year. The decrease over the prior year is largely due to lower amortization charges. Quarterly R&D expenses, net of tax credits, were $6.0 million or 14% of sales, versus $6.2 million and 16% of sales last year.Net finance expense was $1.9 million for the quarter, up from $46 thousand the prior year. The increase was largely due to unfavourable currency fluctuations in the current quarter, compared to last year, and an increase in the remeasurement of liabilities related to cash settled share- based payments.EBITDA and Net ProfitEBITDA totalled $3.9 million or 9% of sales, versus $5.5 million and 14% respectively last year. Adjusted EBITDA was up 17% over 2011 to $6.8 million, representing 16% of sales.Net profit was $0.9 million or 4 cents per fully diluted share, compared to $2.3 million and 11 cents respectively in 2011. Adjusted net profit rose 65% over 2011 to $3.2 million or 15 cents per fully diluted share. Liquidity and Capital ResourcesNet operating activities generated $5.6 million of cash flows for the quarter, up from $4.9 million generated in the corresponding period last year. Cash, cash equivalents and temporary investments were $36.6 million at quarter end, increasing from $31.4 million at December 31, 2011.Outlook"Broadcasters are actively exploring new ways to adapt to the rapidly changing world of television and Miranda is well placed to help them become more competitive now and in the future," highlighted Mr. Goodship. "With an expanded portfolio of innovative solutions we will continue to capitalize on new prospects. We see continued long-term growth opportunities ahead, putting us in a good position to outperform market growth and drive profitable results."Strategic ReviewThe review of strategic alternatives announced on March 21, 2012, is well underway. While the Company is actively exploring its options, no reportable event has yet to occur, nor is there any assurance the process will result in a strategic transaction. The strategic review process is expected to last approximately three months from the original announcement.Non-IFRS Financial Measures"Adjusted net profit", "adjusted EPS", "EBITDA" and "adjusted EBITDA" are non-IFRS financial measures: Adjusted net profit Adjusted net profit is defined as net profit prior to recognizing share-based compensation costs, foreign exchange gains or losses and other items that do not impact the core operating performance of the Company, such as special project and acquisition-related costs. All adjustments are net of related income taxes. Adjusted EPS Adjusted earnings per share or adjusted EPS is the adjusted net profit divided by the weighted average number of shares outstanding at the end of a given period. EBITDA EBITDA is defined as net profit before interest expense or interest income, taxes, depreciation and amortization. Adjusted EBITDA Adjusted EBITDA is defined as EBITDA prior to recognizing share-based compensation costs, foreign exchange gains or losses and other items that do not impact the core operating performance of the Company, such as special project and acquisition related costs.Share-based compensation costs are a component of employee remuneration and can vary significantly with changes in the market price of the Company's shares. Foreign exchange gains or losses are a component of finance income or finance costs and can vary significantly with currency fluctuations from one period to another. In addition, other items that do not impact core operating performance of the Company may vary significantly from one period to another. As such, adjusted net profit, adjusted EPS, EBITDA and adjusted EBITDA provide improved continuity with respect to the comparison of the Company's operating results over a period of time.Our method for calculating adjusted net profit, adjusted EPS, EBITDA and adjusted EBITDA may differ from that used by other companies. Readers are advised that adjusted net profit, adjusted EPS, EBITDA and adjusted EBITDA should not be substituted either for net profit as an indicator of operating results in line with IFRS, neither for cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. A reconciliation of net profit to adjusted net profit and adjusted EPS and a reconciliation of net profit to EBITDA and adjusted EBITDA are presented in the following tables.Reconciliation of Net Profit to Adjusted Net Profit and Adjusted Earnings per ShareThree Months Ended March 31,(Unaudited, in thousands of Canadian dollars, except ratios and per share amounts)20122011Net profit9282,322Share-based compensation costs, including cash-settled awards1,492572Foreign exchange losses (gains)615(423)Income taxes recovery relating to the resolution of previous years' matters-(642)Special project costs, including strategic review790-Acquisition-related costs-108Tax effect for above-mentioned items( 600)12Adjusted net profit3,2251,949Adjusted net profit ( % of revenue)8%5%Adjusted earnings per share:Basic0. 150.09Diluted0. 150.09Reconciliation of Net Profit to EBITDA and Adjusted EBITDAThree Months Ended March 31,(Unaudited, in thousands of Canadian dollars, except ratios)20122011Net profit9282,322Interest expense29154Income taxes expense555317Depreciation of property, plant and equipment990944Amortization of intangible assets1,3661,802EBITDA3,8685,539EBITDA (% of revenue)9%14%Share-based compensation costs, including cash-settled awards1,492572Foreign exchange losses (gains)615(423)Special project costs, including strategic review790-Acquisition-related costs-108Adjus ted EBITDA6,7655,796Adjus ted EBITDA (% of revenue)16%15%Conference callMiranda Technologies Inc. (TSX:MT) will hold a conference call with financial analysts to present its first quarter 2012 results on Friday May 11, 2012 at 9:00 AM (ET). Media and other interested parties are invited to join the conference call in listen-only mode.DATE:Friday, May 11, 2012TIME:9:00 a.m. Eastern TimeCALL:(416) 981-9000 (for all Toronto and overseas participants)(800) 709-0218 (for all other North American participants)(Please dial in 15 minutes before the conference begins) WEBCAST: On line at http://www.miranda.com/or http://www.marketwire.com/. The webcast of the conference call will be available for a period of 90 days at www.miranda.com and www.marketwire.com. A recording of the conference call will also be available from 11:00 AM on Friday, May 11, 2012 to 11:59 PM on Friday, May 18, 2012 and can be accessed by dialling 1-800-558-5253 and entering the pass code 21589690# on your telephone keyboard.Forward-looking StatementsThis media release contains forward-looking statements reflecting Miranda's objectives, estimates and expectations. Such statements may be marked by the use of verbs such as "believe", "anticipate", "estimate", "looking ahead" and "expect", as well as the use of the conditional or future tense. By their very nature, such statements involve risks and uncertainties. Consequently, results could differ materially from the Company's expectations. Risks that could cause results to differ materially from Miranda's expectations are discussed under the heading Risks and Uncertainties in the Company's Annual Management's Discussion and Analysis, which is available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release represent Miranda's current expectations and, accordingly, are subject to change. However, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statement, whether as a result of new information or events or otherwise, unless required to do so by the applicable securities legislation.About MirandaMiranda Technologies is a leading worldwide provider of hardware and software solutions for the television broadcast, cable, satellite and IPTV industry. Its solutions span the full breadth of television operations, including production, playout, and delivery.With a wealth of experience in delivering IT-based and traditional television systems, Miranda is uniquely positioned to help customers enhance their facilities, while generating additional revenue, reducing costs and streamlining operations.For over 22 years, Miranda's growth has been driven by continuous innovation, along with close customer partnerships focused on helping them achieve their business objectives. To deliver this support, Miranda employs approximately 700 people globally, in both developed and emerging markets. Miranda's head office is located in Montreal, and it has regional facilities in the United States, the United Kingdom, France, the United Arab Emirates, Japan, Malaysia, Singapore, Hong Kong and mainland China. A public company since December 2005, Miranda's shares (TSX:MT) are traded on the Toronto Stock Exchange. More information on the Company can be found at www.miranda.com.MIRANDA TECHNOLOGIES INC.Condensed Consolidated Interim Statements of Financial Position (Unaudited) March 31, 2012 and December 31, 2011(In thousands of Canadian dollars)March 31,December 31,20122011AssetsCurrent assetsCash and cash equivalents$36,633$31,367Trade and other receivables34,38342,547Inventories20,95920,350Income taxes and tax credits receivable4,0583,453Prepaid expenses and other2,1402,03598,17399,752Tax credits receivable11,92711,352Property, plant and equipment31,82432,548Intangible assets32,71534,081Goodwill44,74544,745Total assets$219,384$222,478LiabilitiesCurrent liabilitiesTrade and other payables$22,912$25,045Provisions1,8111,762Deferred revenue7,0566,229Income taxes payable2,2194,14333,99837,179Other payables124391Provisions1,6281,655Deferred revenue3,5933,595Deferred tax liabilities13,49914,161Total liabilities52,84256,981EquityShare capital98,27498,221Contributed surplus5,1065,042Retained earnings63,81262,884Accumulated other comprehensive loss(650)(650)Total equity166,542165,497Total liabilities and equity$219,384$222,478MIRANDA TECHNOLOGIES INC.Condensed Consolidated Interim Statements of Comprehensive Income(Unaudited)Three-month periods ended March 31, 2012 and 2011(In thousands of Canadian dollars, except per share amounts)March 31,March 31,20122011Revenue$42,416$39,797Cost of sales16,55515,840Gross profit25,86123,957Selling, general and administration expenses16,47115,084Research and development expenses, net of tax credits of $1,386 ($1,414 in 2011)6,0216,188Results from operating activities3,3692,685Finance income(135)(560)Finance costs2,021606Net finance expense1,88646Profit before income taxes1,4832,639Income taxes expense555317Net profit for the period9282,322Other comprehensive income:Foreign currency translation differences for foreign operations, net of taxes-(155)Total comprehensive income for the period$928$2,477Earnings per share:Basic$0.04$0.11Diluted0.040.11MIRANDA TECHNOLOGIES INC.Condensed Consolidated Interim Statements of Cash Flows(Unaudited)Three-month periods ended March 31, 2012 and 2011(In thousands of Canadian dollars)March 31,March 31,20122011Operating activities:Net profit for the period$928$2,322Adjustments:Depreciation of property, plant and equipment990944Amortization of intangible assets1,3661,802Share-based compensation costs1,492572Net interest expense29154Income taxes expense555317Effect of exchange rates on long-term monetary assets and liabilities76131Effect of exchange rates on cash and cash equivalents118(90)5,5546,152Changes in non-cash operating working capital items:Trade and other receivables8,1644,435Inventories(609)(1,294)Income taxes and tax credits receivable and income taxes payable(1,408)(24)Prepaid expenses and other(105)(472)Trade and other payables(3,828)(2,621)Provisions22(352)Deferred revenue825(364)Cash generated from operating activities8,6155,460Income taxes paid(2,989)(567)Net cash from operating activities5,6264,893Investing activities:Proceeds from sale of temporary investments-4,999Additions to property, plant and equipment(266)(581)Interest received924Net cash (used in) from investing activities(257)4,442Financing activities:Repayment of loans and borrowings-(5,776)Proceeds from exercise of share options53-Interest paid(38)(178)Net cash from (used in) financing activities15(5,954)Effect of exchange rates on cash and cash equivalents(118)90Effect of exchange rates on cash and cash equivalents related to translation of foreign operations-(121)Net increase in cash and cash equivalents5,2663,350Cash and cash equivalents, beginning of period31,36730,486Cash and cash equivalents, end of period$36,633$33,836FOR FURTHER INFORMATION PLEASE CONTACT: Miranda Technologies IncSource:ORInvestors and MediaContacts:Mario SettinoChief Financial OfficerMiranda Technologies Inc.(514) 333-1772