SeaChange Posts Q1 Report

SeaChange International announced financial results for its fiscal 2012 first quarter ended April 30, 2011

June 10, 2011

4 Min Read

ACTON, Mass. -- SeaChange International, Inc. (NASDAQ: SEAC), a leading global multi-screen video software company, announced financial results for its fiscal 2012 first quarter ended April 30, 2011. Total revenues for the quarter were $52.1 million, which were $2.5 million lower than total revenues of $54.6 million for the first quarter of fiscal 2011. Non-GAAP net income for the first quarter was $2.1 million or $0.06 per share compared with non-GAAP net income of $3.1 million or $0.10 per share for the same period last year. GAAP net loss for the first quarter of fiscal 2012 was $0.4 million, or $0.01 per share, compared with GAAP net income of $20.3 million, or $0.64 per share, for the first quarter of fiscal 2011. Last year’s first quarter GAAP earnings included a pre-tax gain of $25.2 million related to the Company’s sale of its equity investment in Casa Systems.

Significant GAAP items that have been excluded in calculating non-GAAP net income include the gain related to the Casa divestiture in the first quarter of last year, deferred revenue adjustments related to recent acquisitions, acquisition-related costs, reversal of deferred tax valuation allowance, restructuring charges, amortization of intangible assets and stock compensation expense. A reconciliation of GAAP net income to non-GAAP net income is attached to this release and is available on the Company’s website (http://www.schange.com/ir).

The Company ended the first quarter of fiscal 2012 with cash, cash equivalents and marketable securities of $91.0 million and no debt compared to $86.2 million and no debt at the end of the fourth quarter of fiscal 2011. The $4.8 million increase in cash in this year’s first quarter was generated by cash flow from operations and a reduction in accounts receivable from improved collection efforts that were partially offset by acquisition payments made to the former shareholders of VividLogic.

Segment Revenue Results

Total revenues in the first quarter from the Company’s Software segment were $35.5 million, which were $4.6 million lower than Software segment revenues of $40.1 million in the first quarter of last year. The reduction in year over year revenues in the Software segment was driven by a large VOD back office software order that was delivered in last year’s first quarter to a large North American cable television provider as part of the displacement of a competitor at that customer. The impact of this significant order compared to last year’s first quarter was partially offset in this year’s first quarter by increased VOD software subscription revenues from a North American customer and higher VOD software revenues from eventIS.

The Servers and Storage segment generated $7.6 million of revenues for the first quarter of fiscal 2012, which were $0.5 million lower than comparable revenues of $8.1 million for the first quarter of fiscal 2011. The decrease in Servers and Storage revenues between years was due to lower VOD server maintenance and warranty revenues.

Media Services segment revenues for this year’s first quarter were $8.9 million, which were $2.5 million or 40% higher than revenues of $6.4 million for the first quarter of last year. The increase in Media Services revenues in this year’s first quarter compared to the first quarter of fiscal 2011 was due to increases from customers in Greece, France and Dubai.

“We are pleased with our financial performance for the first quarter of fiscal 2012 as we exceeded both our revenue and earnings guidance,” commented Bill Styslinger, SeaChange International CEO and Chairman. “We continue to be encouraged by the response from customers to our Adrenalin multi-screen video software. We have customer deployments in each major region of the world and are in contract discussions with several more prospects, both new and existing customers, for deployments this year. In addition, we saw our customer diversification strategy take hold in the first quarter as approximately 40 percent of our revenue in the quarter was derived from European customers fueled by strong revenue contributions from eventIS and On Demand Group.”

Styslinger continued, “The first quarter saw one of our largest customers extend its VOD software subscription agreement, demonstrating this customer’s confidence in our VOD back office solution for their expanding VOD needs. Combined with increased multi-screen video software deployments, improving revenue momentum from our home media gateway software products and continued strength from eventIS and On Demand Group, we are now forecasting second quarter revenues of $53 to $58 million and non-GAAP earnings per share of $0.13 to $0.19. In addition, we are raising our full year non-GAAP earnings per share target to $0.66 to $0.74 from our previous guidance of $0.62 to $0.70 per share.”

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