- Revenue: $61.5M, Gross Profit: $28.8M, Adjusted EBITDA:
$8.1M
- Gross Margin: 47%, Adjusted Gross Margin: 48%
- Content Delivery and Storage Segment Grows Revenue 43% YoY to
$15.7M
- Engagements for Entra Cable & Fiber Access now span 158
unique program opportunities across 108 service provider customers
globally
- Highly successful showcase at SCTE Cable-Tec Expo 2023, the
industry’s largest tradeshow, with Entra ERM3 winning 5 Diamonds,
the highest rating, at BTR’s Diamond Technology Awards
Vecima Networks Inc. (TSX: VCM) today reported financial results
for the three months ended September 30, 2023.
FINANCIAL HIGHLIGHTS
(Canadian dollars in millions except
percentages, employees, and per share data)
Q1FY24
Q4FY23
Q1FY23
Revenue
$61.5
$75.5
$73.4
Gross Margin
46.9%
50.5%
45.9%
Net Income
$1.7
$5.1
$9.5
Earnings Per Share1
$0.07
$0.21
$0.41
Adjusted Gross Margin2
47.9%
50.5%
45.9%
Adjusted Earnings Per Share1,2,3,4,5
$0.09
$0.25
$0.41
Adjusted EBITDA3
$8.1
$15.1
$17.2
Employees
591
602
607
1 Based on weighted average number of
shares outstanding.
2 Adjusted Gross Margin, Adjusted Earnings
Per Share, and Adjusted EBITDA do not have a standardized meaning
under IFRS and therefore may not be comparable to similar measures
provided by other issuers. See “Adjusted Gross Margin, Adjusted
EBITDA, and Adjusted Earnings Per Share” below.
3 Starting in Q4 fiscal 2019, we have
changed our definition and calculation of Adjusted Earnings Per
Share. For a reconciliation of Adjusted Earnings Per Share,
investors should refer to Vecima’s Management’s Discussion and
Analysis for the first quarter of fiscal 2024.
4 Adjusted Earnings Per Share includes
non-cash share-based compensation of $0.3 million or $0.01 per
share for the three months ended September 30, 2023, and $0.1
million or $nil per share for the three months ended September 30,
2022.The non-cash share-based compensation primarily reflects
certain performance-based vesting thresholds achieved under the
Company’s Performance Share Unit Plan.
5 Adjusted Earnings Per Share includes
foreign exchange loss of $0.6 million or $0.02 per share for the
three months ended September 30, 2023, and $1.3 million or $0.06
per share for the three months ended September 30, 2022.
“Vecima performed well in the first quarter as we achieved
positive operating results and generated year-over-year revenue
growth in our Content Delivery and Storage and Telematics segments,
while weathering the anticipated temporary slowdown in Entra
distributed access architecture (DAA) product deliveries,” said
Sumit Kumar, Vecima’s President and Chief Executive Officer.
“As we noted in our fourth quarter report, we successfully
managed major constraints in the supply chain during fiscal 2023 to
fulfill strong DAA deliveries in support of our customers’ ongoing
major network upgrade projects. Correspondingly, customers have now
temporarily shifted from building up their product pipelines to
managing their DAA rollout logistics, expanding field deployment
activity, and working through existing inventories. We anticipate
renewed Entra sales growth in the second half of fiscal 2024 as
customers bring inventories into balance while initiating new
programs and deployments alike. These encompass additional DAA
launches and project ramp-ups with key customers, including a major
ERM3 rollout to support a Tier 1 customer’s network evolution to
10G.”
“In our Content Delivery and Storage segment, first quarter
sales grew 43% to $15.7 million, reflecting both the growing base
of customers for our IPTV solutions and expansions with a number of
these customers during the period. Paired with strong gross margin
performance of 58.5%, our CDS segment enjoyed an excellent start to
fiscal 2024,” added Mr. Kumar.
“Operationally, we continued to focus on tightly managing the
business to achieve efficiently lower operating expenses while
continuing to advance our technologies and industry leadership with
robust R&D investment. We ended the first quarter in a strong
financial position, with an unparalleled portfolio of
next-generation solutions, a veritable war chest of customer
program-aligned DAA product inventory, and a growing base of
customers that are effecting a widescale migration to
next-generation networks globally using our products. While the
timing of our customers’ rollouts may naturally vary, we see
multiple pathways for growth coalescing as the year progresses and
translating into the next wave of revenue momentum in the latter
half of fiscal 2024,” said Mr. Kumar.
BUSINESS HIGHLIGHTS
Financial and Corporate
- First quarter revenue of $61.5 million as compared to $73.4
million in Q1 fiscal 2023.
- Achieved gross profit of $28.8 million, as compared to $33.7
million in Q1 fiscal 2023.
- Gross margin and adjusted gross margin increased to 46.9% and
47.9%, respectively, from 45.9% in the prior-year period.
- Adjusted EBITDA was $8.1 million, as compared to $17.2 million
in Q1 fiscal 2023.
- EPS and Adjusted EPS were $0.07 and $0.09 per share,
respectively, as compared to EPS and Adjusted EPS of $0.41 per
share in Q1 fiscal 2023.
- Ended the first quarter in strong financial position with
working capital of $79.0 million at September 30, 2023, compared to
$83.7 million at June 30, 2023.
Video and Broadband Solutions (VBS)
The Video and Broadband Solutions segment contributed first
quarter sales of $44.1 million, as compared to $61.0 million in Q1
fiscal 2023 and $57.0 million in Q4 fiscal 2023.
DAA (Entra Family)
- Next-generation Entra product sales of $38.8 million were in
line with expectations and compared to $53.0 million in Q1 fiscal
2023 and $50.7 million in Q4 fiscal 2023.
Notable first quarter DAA achievements:
- An increase in total customer engagements to 108 MSOs
worldwide, from 95 a year earlier. Fifty-one of these customers are
ordering Entra products, with order sizes increasing as broader DAA
deployment continues.
- Customers engaged for cable access now number 62.
- Customers engaged for fiber access or both access technologies
now number 46.
- Vecima supported Orion Cable’s broadband expansion with a
scalable, quick-to-deploy and turnkey remote MACPHY solution that
drives value through partnership with the customer and supports
unique needs for flexible, open, and interoperable broadband access
networks.
- Executed warrant agreement with Charter Communications Holding
Company, LLC as disclosed and further discussed in our press
release dated September 11, 2023.
Achievements subsequent to the quarter-end:
- Participated in the SCTE Cable-Tec Expo 2023, a major industry
show, demonstrating recent innovations in Vecima’s Remote PHY,
Access Nodes, PON, Open CDN, Dynamic Content and TruLiveTM product
lines. Vecima’s technology was a key focus for industry
decision-makers where interest in our expansive portfolio was
prominent and unparalleled.
- Entra ERM3 Remote PHY device was honoured with five diamonds in
the 2023 BTR Diamond Technology Reviews Awards. The ERM3 RPD helps
operators upgrade legacy HFC nodes to DAA quickly and
cost-effectively, while dramatically increasing broadband
capacity.
- Announced availability of Vecima’s DOCSIS 4.0-Ready and 1.8 GHz
‘Forever Nodes’ which provide a clear and cost-effective path to
10G by supporting DAA today while also supporting future
technologies, including DOCSIS 4.0 and Remote Optical Line Terminal
(OLT) applications.
Commercial Video (Terrace Family)
- Commercial Video products contributed $5.3 million to first
quarter VBS sales, as compared to $7.3 million in Q1 fiscal 2023
and $6.3 million in Q4 fiscal 2023. The year-over-year change
reflects the transition to next-generation platforms and the impact
of some of Vecima’s newer DAA-driven Commercial Video solutions
being accounted for as part of Entra family sales.
Content Delivery and Storage (CDS)
- First quarter CDS segment sales grew 43% to $15.7 million, from
$11.0 million in Q1 fiscal 2023. This included a 56% increase in
product sales and a 24% increase in services revenue. On a
sequential quarterly basis, CDS sales were 8% lower than the record
$17.1 million performance achieved in Q4 fiscal 2023.
- CDS gross margin increased to 58.5%, from 54.5% in Q1 fiscal
2023 and 53.8% in Q4 fiscal 2023.
- Subsequent to the quarter-end, announced an engagement with
Blue Ridge Communications to support this customer’s video
expansion. Blue Ridge has engaged Vecima’s professional services
team to provide assisted operations support utilizing proprietary
tools to remotely monitor Blue Ridge’s IP video network for issues,
while maximizing system up-time and operating efficiency.
Telematics
- First quarter Telematics sales grew approximately 14% to $1.6
million, from $1.4 million in both Q1 fiscal 2023 and Q4 fiscal
2023.
- Generated additional deployments in high-value verticals,
including municipal government and moveable asset customers.
- Achieved our best quarter to date for additions of new moveable
asset subscriptions, adding 14 new customers to the NERO asset
tracking platform, and significantly increasing the number of
moveable assets being monitored to over 57,000 units.
- Achieved strong gross margin percentage of 64.9%.
“Moving forward, Vecima’s long-term outlook remains
exceptionally compelling,” added Mr. Kumar. “We are continuing to
demonstrate the full deployment potential of our technologies as we
support our customers’ wide-scale network transformations and
repeatedly break new ground in ultra-high-speed connectivity. We
are advancing further from a global leadership position and remain
highly confident in our ability to capture the major and multi-year
opportunities in the large DAA and IPTV markets.”
As previously reported, Vecima’s Board of Directors declared a
quarterly dividend of $0.055 per share for the period. The dividend
will be payable on December 18, 2023 to shareholders of record as
at November 24, 2023.
CONFERENCE CALL
A conference call and live audio webcast will be held today,
November 9, 2023 at 1 p.m. ET to discuss the Company’s first
quarter results. Vecima’s unaudited interim condensed consolidated
financial statements and management’s discussion and analysis for
the three months ended September 30, 2023 are available under the
Company’s profile at www.sedarplus.ca, and at
https://vecima.com/investor-relations/financial-reports/.
To participate in the teleconference, dial 1-800-319-4610 or
1-604-638-9020. The webcast will be available in real time at
http://services.choruscall.ca/links/vecima2024q1.html and will be
archived on the Vecima website at
https://vecima.com/investor-relations/earnings-call-archive/.
About Vecima Networks
Vecima Networks Inc. (TSX: VCM) is leading the global evolution
to the multi-gigabit, content-rich networks of the future. Our
talented people deliver future-ready software, services, and
integrated platforms that power broadband and video streaming
networks, monitor and manage transportation, and transform
experiences in homes, businesses, and everywhere people connect. We
help our customers evolve their networks with cloud-based solutions
that deliver ground-breaking speed, superior video quality, and
exciting new services to their subscribers. There is power in
connectivity – it enables people, businesses, and communities to
grow and thrive. Learn more at www.vecima.com.
Adjusted Gross Margin, Adjusted EBITDA, and Adjusted Earnings
Per Share
Adjusted Gross Margin, Adjusted EBITDA, and Adjusted Earnings
Per Share do not have a standardized meaning under IFRS and
therefore may not be comparable to similar measures provided by
other issuers. Accordingly, investors are cautioned that Adjusted
Gross Margin, Adjusted EBITDA, or Adjusted Earnings Per Share
should not be construed as an alternative to net income, determined
in accordance with IFRS, as an indicator of the Company’s financial
performance or as a measure of its liquidity and cash flows. For a
reconciliation of Adjusted Gross Margin, Adjusted EBITDA, or
Adjusted Earnings (Per Share, investors should refer to Vecima’s
Management’s Discussion and Analysis for the first quarter of
fiscal 2024.
Forward-Looking Statements
This news release contains “forward-looking information” within
the meaning of applicable securities laws. Forward-looking
information is generally identifiable by use of the words
“believes”, “may”, “plans”, “will”, “anticipates”, “intends”,
“could”, “estimates”, “expects”, “forecasts”, “projects” and
similar expressions, and the negative of such expressions.
Forward-looking information in this news release includes the
following statements: Vecima performed well in the first quarter as
we achieved positive operating results and generated year-over-year
revenue growth in our Content Delivery and Storage and Telematics
segments, while weathering the anticipated temporary slowdown in
Entra distributed access architecture (DAA) product deliveries; we
anticipate renewed Entra sales growth in the second half of fiscal
2024 as customers bring inventories into balance while initiating
new programs and deployments alike; while the timing of our
customers’ rollouts may naturally vary, we see multiple pathways
for growth coalescing as the year progresses and translating into
the next wave of revenue momentum in the latter half of fiscal
2024; moving forward, Vecima’s long-term outlook remains
exceptionally compelling; we are advancing further from a global
leadership position and remain highly confident in our ability to
capture the major and multi-year opportunities in the large DAA and
IPTV markets.
A more complete discussion of the risks and uncertainties facing
Vecima is disclosed under the heading “Risk Factors” in the
Company’s Annual Information Form dated September 21, 2023, as well
as the Company’s continuous disclosure filings with Canadian
securities regulatory authorities available at www.sedarplus.ca.
All forward-looking information herein is qualified in its entirety
by this cautionary statement, and Vecima disclaims any obligation
to revise or update any such forward-looking information or to
publicly announce the result of any revisions to any of the
forward-looking information contained herein to reflect future
results, events or developments, except as required by law.
VECIMA NETWORKS INC.
Interim Condensed Consolidated
Statements of Financial Position
(unaudited - in thousands of Canadian
dollars)
As at
September 30, 2023
June 30, 2023
Assets
Current assets
Cash and cash equivalents
$
2,292
$
2,278
Accounts receivable
50,136
57,662
Income tax receivable
532
530
Inventories
137,004
101,601
Prepaid expenses and other current
assets
5,977
13,695
Contract assets
1,805
2,707
Total current assets
197,746
178,473
Non-current assets
Property, plant and equipment
15,683
15,683
Right-of-use assets
2,044
2,364
Goodwill
15,188
15,049
Intangible assets
85,872
82,991
Investment tax credits
24,151
24,252
Deferred tax assets
15,004
11,576
Other long-term assets
2,119
1,298
Total assets
$
357,807
$
331,686
Liabilities and shareholders’
equity
Current liabilities
Revolving line of credit
$
19,677
$
20,513
Accounts payable and accrued
liabilities
73,942
47,162
Provisions
772
1,978
Income tax payable
8,858
7,808
Deferred revenue
11,875
15,086
Current portion of financial liability
515
-
Current portion of long-term debt
1,796
2,260
Dividend payable
1,336
-
Total current liabilities
118,771
94,807
Non-current liabilities
Provisions
373
387
Deferred revenue
4,238
4,716
Long-term portion of financial
liability
1,100
-
Long-term debt
13,950
14,123
Total liabilities
138,432
114,033
Shareholders’ equity
Share capital
23,997
23,997
Reserves
3,367
3,111
Retained earnings
191,419
190,926
Accumulated other comprehensive loss
592
(381)
Total shareholders’ equity
219,375
217,653
Total liabilities and shareholders’
equity
$
357,807
$
331,686
VECIMA NETWORKS INC.
Interim Condensed Consolidated
Statements of Comprehensive Income
(unaudited - in thousands of Canadian
dollars, except per share amounts)
Three months ended September
30,
2023
2022
Sales
$
61,478
$
73,447
Cost of sales
32,665
39,706
Gross profit
28,813
33,741
Operating expenses
Research and development
10,296
10,705
Sales and marketing
7,429
6,304
General and administrative
7,973
5,594
Share-based compensation
256
98
Other expense
170
21
Total operating expenses
26,124
22,722
Operating income
2,689
11,019
Finance expense
(700)
(201)
Foreign exchange gain (loss)
(584)
1,302
Income before income taxes
1,405
12,120
Income tax expense (recovery)
(340)
2,608
Net income
$
1,745
$
9,512
Other comprehensive income
Item that may be subsequently reclassed
to net income
Exchange differences on translating
foreign operations
$
973
$
2,369
Comprehensive income
$
2,718
$
11,881
Net income per share
Basic
$
0.07
$
0.41
Diluted
$
0.07
$
0.41
Weighted average number of common
shares
Shares outstanding – basic
24,301,594
23,104,507
Shares outstanding - diluted
24,324,324
23,132,401
VECIMA NETWORKS INC.
Interim Condensed Consolidated
Statements of Change in Equity
(unaudited - in thousands of Canadian
dollars)
Share capital
Reserves
Retained
earnings
Accumulated
other
comprehensive income
(loss)
Total
Balance as at June 30, 2022
$
7,935
$
3,141
$
168,923
$
(267)
$
179,732
Net income
-
-
9,512
-
9,512
Other comprehensive income
-
-
-
2,369
2,369
Dividends
-
-
(1,271)
-
(1,271)
Shares issued by exercising options
61
(12)
-
-
49
PSUs settled in common shares
49
(49)
-
-
-
Withholding taxes on PSUs
(44)
-
-
-
(44)
Share-based payment expense
-
98
-
-
98
Balance as at September 30,
2022
$
8,001
$
3,178
$
177,164
$
2,102
$
190,445
Balance as at June 30, 2023
$
23,997
$
3,111
$
190,926
$
(381)
$
217,653
Net income
-
-
1,745
-
1,745
Other comprehensive income
-
-
-
973
973
Dividends
-
-
(1,252)
-
(1,252)
Share-based payment expense
-
256
-
-
256
Balance as at September 30,
2023
$
23,997
$
3,367
$
191,419
$
592
$
219,375
VECIMA NETWORKS INC.
Interim Condensed Consolidated
Statements of Cash Flows
(unaudited - in thousands of Canadian
dollars)
Three months ended September
30,
2023
2022
OPERATING ACTIVITIES
Net income
$
1,745
$
9,512
Adjustments for non-cash items:
Loss on sale of property, plant and
equipment
1
9
Depreciation and amortization
5,123
4,750
Share-based compensation
256
98
Warrant expense
638
-
Income tax expense
2,711
1,948
Deferred income tax expense (recovery)
(3,051
)
660
Interest expense
700
212
Interest income
(2
)
(10
)
Net change in working capital
4,234
(24,366
)
Decrease in other long-term assets
12
142
Increase (decrease) in provisions
(1,218
)
16
Increase in investment tax credits
(33
)
(40
)
Income tax received (paid)
(1,950
)
30
Interest received
2
10
Interest paid
(727
)
(175
)
Cash provided by (used in) operating
activities
8,441
(7,204
)
INVESTING ACTIVITIES
Capital expenditures, net
(763
)
(887
)
Deferred development costs
(6,231
)
(5,581
)
Cash used in investing
activities
(6,994
)
(6,468
)
FINANCING ACTIVITIES
Net draws (repayments) of the revolving
line of credit
(836
)
6,832
Principal repayments of lease
liabilities
(405
)
(379
)
Repayment of long-term debt
(280
)
(67
)
Issuance of shares through exercised
options
-
49
Withholding taxes on PSUs
-
(44
)
Cash provided by (used in) financing
activities
(1,521
)
6,391
Net decrease in cash and cash
equivalents
(74
)
(7,281
)
Effect of change in exchange rates on
cash
88
(1,277
)
Cash and cash equivalents, beginning of
year
2,278
12,902
Cash and cash equivalents, end of
period
$
2,292
$
4,344
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231109383433/en/
Vecima Networks Investor Relations - 250-881-1982
invest@vecima.com www.vecima.com
Vecima Networks (TSX:VCM)
Gráfico Histórico do Ativo
De Ago 2024 até Set 2024
Vecima Networks (TSX:VCM)
Gráfico Histórico do Ativo
De Set 2023 até Set 2024