Vecima Reports Q1 Fiscal 2021 Results
Vecima Networks Inc. (TSX:VCM) today reported financial results for the three months ended September 30, 2020.
"In a year in which we anticipate significant growth, we set the stage by increasing first quarter revenue by 38% to $27.8 million, our best quarterly result in over four years," said Sumit Kumar, Vecima's President and CEO. "Our strong topline results were accompanied by gross profit of $13.0 million and adjusted EBITDA of $2.2 million, which were both up 24% as compared to Q1 fiscal 2020."
"In the Video and Broadband Solutions segment, sales of $13.5 million increased by a very significant 81% year-over-year. This was led by strong sales growth for our new Entra products as the distributed access architecture market kicked off. I am delighted to report that Entra revenues rose sharply to $5.2 million during the quarter, coming close to matching in just three months what we achieved in all of fiscal 2020. The Entra growth was driven by production deployments of our industry-leading Entra Remote PHY Node to our lead Tier 1 customer, as well as initial deployment-related Remote PHY Node purchases made by multiple additional operators. Sales of the Entra Interactive Video Controller (IVC) product also grew significantly, and our newly acquired DAA portfolio, which includes Remote MAC-PHY and EPON/DPoE technologies, contributed approximately $1 million to first quarter Entra sales. Video and Broadband Solutions sales were further bolstered by a significant year-over-year increase in TerraceQAM commercial video sales during the period."
"In our Content Delivery and Storage segment, we achieved solid revenue of $13.0 million in what is traditionally the seasonally slowest quarter for this segment," added Mr. Kumar. "CDS sales were up 15% year-over-year as we consolidated the major new business wins of fiscal 2020. We also added two new customer wins during the quarter, securing an additional two IPTV conversions. Our MediaScaleX solutions are now in use by over 100 cable companies, telcos and broadcasters worldwide, translating into a vast base for the future given that most of these customers are just starting their migration to IPTV and scale subscriber uptake remains ahead of Vecima and our customers."
Video and Broadband Solutions (VBS)
Commercial Video (Terrace) Family
Content Delivery and Storage (CDS)
"We believe the momentum achieved in the first quarter is just the start of what's in store for fiscal 2021," added Mr. Kumar. "We anticipate continued ramp in Entra DAA sales, particularly in the second half as our lead customers transition to scale deployment and a broader set of MSOs initiate field deployments of DAA to respond to network capacity pressures being seen globally. Our newly acquired Remote MAC-PHY and EPON/DPoE solutions are already performing well and the build-up of overall market activity we see with the combined portfolio is very exciting and fully in line with our expectations after having created the industry's best access network product lineup. We will continue to leverage the strong opportunities provided by these leading products in the once-in-a-lifetime network upgrade they cover. In our Content Delivery and Storage segment, we continue to anticipate measured sales growth in FY2021 as we consolidate the record-setting customer wins of last year and IPTV usage continues to increase rapidly in households globally."
"As we move forward, we remain highly confident in our view that fiscal 2021 will be a breakthrough year for Vecima. The move to DAA and IPTV is underway and we are ideally positioned with an unmatched portfolio of industry-leading, next generation solutions and platforms," said Mr. Kumar.
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 21, 2020 to shareholders of record as at November 27, 2020.
A conference call and live audio webcast will be held today, November 12, 2020 at 1 p.m. ET to discuss the Company's first quarter results. Vecima's unaudited condensed interim consolidated financial statements and management's discussion and analysis for the three months ended September 30, 2020 are available under the Company's profile at www.SEDAR.com, and at www.vecima.com/financials/.
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/vecima20201112.html and will be archived on the Vecima website at https://vecima.com/investor-relations/earnings-call-archive/.
About Vecima Networks
Adjusted EBITDA and Adjusted Earnings / (Loss) Per Share
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 24, 2020, as well as the Company's continuous disclosure filings with Canadian securities regulatory authorities available at www.sedar.com. 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.