Chyron Reports 2003 Fourth Quarter and Full Year Results.Business Editors/High-Tech Writers MELVILLE, N.Y.--(BUSINESS WIRE)--March 11, 2004 Chyron Corporation Chyron Corporation is a Melville, NY based company founded in 1966. The company develops and manufactures on screen graphics solutions for the broadcast industry. In the United States the graphics (e.g. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). : CYRO) today announced financial results for the fourth quarter ended December December: see month. 31, 2003. Revenue from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the fourth quarter ended December 31, 2003 was $5.4 million, an increase of $1.6 million or 44% from third quarter 2003 revenue of $3.7 million, and a decrease of $0.2 million or 4% as compared to $5.6 million for the same quarter last year. For the full year 2003, revenue from continuing operations was $19.4 million, a decrease of $1.7 million or 8% as compared to $21.1 million for full year 2002. Consolidated net profit for the fourth quarter of 2003 was $2.1 million, or $0.05 per share, as compared to a $2.2 million net loss, or $0.05 per share, for the third quarter of 2003 and a $0.3 million net loss, or $0.01 per share, for the fourth quarter of 2002. From continuing operations, the Company reported a net loss for the fourth quarter of 2003 of $0.2 million, or $0.00 per share, as compared to a net loss of $0.5 million, or $0.01 per share, for the fourth quarter of 2002, and a net loss of $1.5 million, or $0.04 per share for the third quarter of 2003. Included in the fourth quarter of 2004 net loss from continuing operations were $0.4 million in one time charges resulting from the sale of the Company's signal and automation business and a gain of $0.6 million on debt extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. . From discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , the Company reported a loss for the fourth quarter of 2003 of $0.3 million, offset by a gain on the sale of the Company's signal distribution and automation business of $2.6 million, for a net profit of $2.3 million or $0.05 per share. Net loss from discontinued operations for third quarter of 2003 was $0.7 million or $0.01 per share, and net profit from discontinued operations for fourth quarter of 2002 was $0.1 million or $0.00 per share. For full year 2003, the Company reported a loss from continuing operations of $1.9 million, or $0.05 per share, as compared to a net loss from continuing operations of $2.1 million, or $0.05 per share for full year 2002. Net loss from discontinued operations for full year 2003 was $1.0 million, offset by a gain on sale of discontinued operations of $2.6 million, for a net gain related to discontinued operations of $1.6 million or $0.04 per share, as compared to a net loss from discontinued operations for full year 2002 of $1.0 million, or $0.03 per share. For the full year 2003, the Company's continuing operations generated cash of $0.9 million from operating activities, generated net cash of $10.3 million from the sale of its Pro-Bel subsidiary, and used cash of $7.4 million for repayment of debt, resulting in a net increase of $3.8 million in cash from continuing operations, while the Company's discontinued operations generated $1.0 million, resulting in a net increase in cash of $4.8 million. As a result, the Company's cash and cash equivalents increased from $2.2 million at the beginning of the year to $7.0 million at the end of 2003. This is a significant improvement over the year 2002. During 2002, the Company's continuing operations generated $0.3 million from operating activities, used $0.1 for investing activities, and used $1.2 million to pay down debts, for a net use of $1.0 million from continuing operations, while its discontinued operations used $1.1 million in cash, resulting in a net cash decrease of $2.1 million. Michael Wellesley-Wesley, Chyron Chyron may refer to:
adj. Originating, existing, or happening during the same period of time: the contemporaneous reigns of two monarchs. See Synonyms at contemporary. introduction of LCD (Liquid Crystal Display) A display technology that uses rod-shaped molecules (liquid crystals) that flow like liquid and bend light. Unenergized, the crystals direct light through two polarizing filters, allowing a natural background color to show. and Plasma TVs A flat panel TV that uses the plasma display technology. See flat panel TV, plasma display and LCD vs. plasma. and High-Definition broadcast technology is contributing to the increase in spending in our markets. Our increase in gross margins primarily reflects lower materials costs as a result of our continued move from proprietary to open architecture and increased inter-changeability of component parts. Research and development expense in the fourth quarter increased 50% over the same quarter last year. We anticipate that the benefits of our increased spending on research and development will be evident when we introduce our new products at this year's NAB show. Our recently announced debt restructurings Debt Restructuring A method used by companies with outstanding debt obligations to alter the terms of the debt agreements in order to achieve some advantage. Notes: and current cash position have significantly improved our balance sheet. Chyron's real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. broadcast graphics production and management products continue to provide innovative solutions to the changing demands of our professional video, Worldwide Web, and TV broadcast production customers." From time to time, including in this press release, the Company may publish forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc such matters as anticipated financial performance, business prospects, technological developments, changes in the industry, new products, research and development activities and similar matters. The Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 provides a safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause the Company's actual results to differ materially from the anticipated results or other expectations expressed in the Company's forward-looking statements. The risks and uncertainties that may affect the operations, performance, development and results of the Company's business include, without limitation, the following: product concentration in a mature market, dependence on the emerging digital market and the industry's transition to DTV (Digital TeleVision) Transmitting TV using digital signals. The major DTV standards are ATSC (North America), DVB (Europe) and ISDB (Japan). All three use MPEG-2 video compression and Dolby Digital audio compression. DVB and ISDB also include MPEG audio compression. and HDTV (High Definition TV) A set of digital television (DTV) standards that offer the highest resolution and sharpest picture. Although some HDTV sets are available in standard (rather square) screen sizes, the overwhelming majority of sets are wide screen, which eliminates , consumer acceptance of DTV and HDTV, resistance within the broadcast or cable industry to implement DTV and HDTV technology, use and improvement of the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the , new technologies that could render certain Chyron products to be obsolete OBSOLETE. This term is applied to those laws which have lost their efficacy, without being repealed, 2. A positive statute, unrepealed, can never be repealed by non-user alone. 4 Yeates, Rep. 181; Id. 215; 1 Browne's Rep. Appx. 28; 13 Serg. & Rawle, 447. , a highly competitive environment, competitors with significantly greater financial resources, new product introductions by competitors, seasonality, fluctuations in quarterly operating results, ability to maintain adequate levels of working capital, the viability of the OTC Bulletin Board OTC Bulletin Board An electronic quotation listing of the bid and asked prices of OTC stocks that do not meet the requirements to be listed on the NASDAQ stock-listing system. as a trading platform, expansion into new markets and the Company's ability to successfully implement its strategic alliance strategy. Chyron The Company the Whole World Watches, Chyron is a leading developer of broadcast television graphics hardware and software ranging from high-definition turnkey systems A complete system of hardware and software delivered to the customer ready-to-run. In other words, just "turn the key" and go.  A Turnkey Video System to OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and board-level solutions. Since introducing its first character generator (1) Circuitry that converts data characters into dot patterns for a display screen. (2) A device that creates text characters that are superimposed onto video frames. in 1970, Chyron has become an industry standard whose brand name is synonymous with synonymous with adjective equivalent to, the same as, identical to, similar to, identified with, equal to, tantamount to, interchangeable with, one and the same as broadcast television graphics. Chyron's current product line includes the Duet/Lyric family of graphic and animation systems, Aprisa still and clip store systems, video mixing solutions, telestration, OEM board-level products, asset management, and more. For more information about Chyron products and services, please visit the company web site at www.chyron.com (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB: CYRO).
CHYRON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Three Months
Ended Year Ended
December 31, December 31,
2003 2002 2003 2002
------- ------- -------- --------
Net sales $5,352 $5,561 $19,369 $21,063
Cost of products sold 2,102 2,969 8,367 10,523
------- ------- -------- --------
Gross profit 3,250 2,592 11,002 10,540
------- ------- -------- --------
Operating expenses:
Selling, general and administrative 2,792 2,086 8,102 8,475
Research and development 781 516 2,663 2,190
------- ------- -------- --------
Total operating expenses 3,573 2,602 10,765 10,665
------- ------- -------- --------
Operating income (loss) (323) (10) 237 (125)
Interest expense 511 479 2,052 2,014
Interest income (11) (2) (21) (14)
Other expense (income), net (656) (20) 150 (42)
------- ------- -------- --------
Loss from continuing operations (167) (467) (1,944) (2,083)
Discontinued operations:
Operating net profit (loss) (323) 137 (1,048) (961)
Gain on sale from disposition 2,599 2,599
------- ------- -------- --------
Net profit (loss) $2,109 $(330) $(393) $(3,044)
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Net income (loss) per share - basic
and diluted
Continuing operations $0.00 $(0.01) $(0.05) $(0.05)
Discontinued operations 0.05 0.00 0.04 (0.03)
------- ------- -------- --------
Net income (loss) per share - basic
and diluted $0.05 $(0.01) $(0.01) $(0.08)
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Weighted average shares used in
computing net income (loss) per share:
Basic 39,688 39,564 39,688 39,564
======= ======= ======== ========
Diluted 39,799 39,564 39,815 39,564
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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands)
December 31,
2003 2002
------- -------
Assets:
Cash and cash equivalents $ 6,968 $ 2,217
Accounts receivable, net 3,454 6,827
Inventories, net 1,714 8,668
Other current assets 955 712
------- -------
Total current assets 13,091 18,424
Non-current assets 1,084 9,563
------- -------
Total assets $14,175 $27,987
======= =======
Liabilities and shareholders' (deficit) equity:
Current liabilities $ 5,134 $15,983
Non-current liabilities 10,622 14,367
------- -------
Total liabilities 15,756 30,350
Shareholders' (deficit) equity (1,581) (2,363)
------- -------
Total liabilities and shareholders' (deficit)
equity $14,175 $27,987
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