Chyron Downward Trend Continues

12 Mar

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Chyron reported declining revenues and increased losses in 2012 Q4 & full year results for the period ended December 31, This continues the downward trend reported in Q3 – Chyron 2012 Q3 & Year to Date Revenue Down on 2011. The negative results follow the company’s close call with being delisted from NASDAQ in November - Chyron Gets NASDAQ Delisting Notice.  In September of 2008 the company was delisted from AMEX to NASDAQ.

Michael Wellesley-Wesley, Chyron CEO commented; “While somewhat disappointing, our fourth quarter financial results were in line with our experience of 2012 as a whole and similar from an end user demand standpoint to conditions being reported by our principal competitors. Demand weakened in the second half of 2012 and didn’t have a meaningful recovery in the fourth quarter. We believe that revenue growth in our traditional mature segments is achievable only through competitive wins and the current depressed and price competitive environment suggests that we will need to move in a different direction for us to rebuild shareholder value. Our industry will consolidate over the next 2-3 years in response to the rapid technology changes currently impacting the broadcast space. There are pockets of strong growth that we need to address and the best way to achieve growth is through alliances, partnerships and acquisitions.”

On cue, Chyron  also announced that it has signed a definitive agreement to acquire the “Hego Group”, a  provider of graphics and data visualization solutions for TV and sports. Hego Group is a privately-held company with its headquarters in Stockholm, Sweden, and has operations in Norway, Finland, Czech Republic, UK and USA. The combined company will be rebranded as ChyronHego.
ChyronFinancial Results: 2012.

Q4 2012 revenues decreased 9% to $7.4 million compared to $8.1 million in Q4 2011; Full year 2012 revenues decreased 4% to $30.2 million versus $31.6 million in 2011.

Gross profit margin for the fourth quarter decreased to 69.1% compared to 71.4% in last year’s fourth quarter. Operating expenses for the quarter were $5.7 million compared to $6.2 million in the comparable quarter of 2011, representing a decrease of 8%. The Company had an operating loss of $0.57 million for the fourth quarter of 2012 compared to an operating loss of $0.43 million in the fourth quarter of 2011.

The Company recorded a net loss of $20.0 million, or $(1.17) per diluted share, in the fourth quarter of 2012 compared to a net loss of $0.4 million, or $(0.02) per diluted share, in the fourth quarter of 2011.

Revenues for full year 2012 decreased 4% to $30.2 million compared to $31.6 million in 2011.

Product revenues in 2012 decreased 9% to $21.7 million compared to $23.9 million in full year 2011. Product revenues as a percentage of total revenues for 2012 were 72% as compared to 76% in 2011.

Service revenues for the full year, which include revenues from the Company’s AXIS cloud-based graphics service, as well as systems hardware and software maintenance agreements, system commissioning, training and creative services, increased 11% to $8.5 million from $7.7 million in 2011. Service revenues as a percentage of total revenues for 2012 were 28% as compared to 24% in 2011.

Gross profit margin for full year 2012 decreased to 69.2% compared to 70% in 2011. Operating expenses for full year 2012 were $24.7 million compared to $24.1 million in 2011, representing an increase of 2%, primarily driven by 10% higher research and development expenses and 4% higher sales and marketing expenses, offset somewhat by 12% lower general and administrative expenses. The Company had an operating loss of $3.7 million in 2012 compared to an operating loss of $1.9 million in 2011.

For the full year 2012 the Company recorded a net loss of $22.3 million compared to a net loss of $4.2 million in full year 2011.

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