Chyron Reports First Quarter 2005 Results.MELVILLE, N.Y. -- 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 that for its first quarter, the Company generated revenues of $6.0 million and incurred a net loss of $0.3 million, or $.01 per share. The Company's new microcasting and digital displays product, ChyTV, was launched in the quarter and net costs associated with it accounted for the quarter's net loss, with the remainder of the Company's business approximately breaking even. Revenues for the first quarter were slightly higher than the $5.8 million reported for the same quarter last year, with substantially no sales contribution from the new ChyTV product. ChyTV was debuted in March at the NSCA NSCA National Systems Contractors Association NSCA National Strength & Conditioning Association NSCA National Society for Clean Air and Environmental Protection (UK) NSCA National Street Car Association NSCA Nebraska Sprint Car Association Show in Orlando and in April, subsequent to the end of the first quarter, at the Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. annual meeting of the National Association of Broadcasters, where it was met with considerable enthusiasm and won a prestigious "Pick Hit" of the Show award from Video Systems Magazine. CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and President Michael Wellesley-Wesley commented, "Despite our somewhat muted first-quarter performance we remain confident that the improving trend in our operating metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. is gaining momentum. Several broadcast graphics orders that were expected to close in the first quarter were deferred until after the NAB tradeshow in early April. These orders have since been received, so we look forward to the medium term with some confidence. The launch of ChyTV went smoothly, and we remain convinced that ChyTV represents an important element in our future. The initial costs of this new product line are merely the necessary price we have to pay to move Chyron Chyron may refer to:
The net loss for the first quarter represented a downtick Downtick A transaction on an exchange occurring at a price below the previous transaction. Notes: In order for a downtick to occur, a transaction price must be followed by a decreased transaction price. compared to net income of $0.3 million, or $.01 per share, for the first quarter of 2004, generated entirely from the real-time broadcast graphics business. Most of the previous year's first-quarter net income resulted from a gain on the sale of marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has of $0.2 million. Gross margins for this year's first quarter were 59 percent compared to 61 percent in last year's comparable quarter. The gross margin variance was primarily due to differences in product mix and slightly lower average selling prices The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. on certain products. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. of $3.7 million for the first quarter of 2005 were $0.4 million higher than the first quarter of 2004, primarily due to expenditures of $0.3 million related to the microcasting and digital displays business, severance costs of $0.1 million, professional fees for Sarbanes-Oxley compliance and new systems and other consulting fees of $0.1 million, and higher employee benefits costs of $0.1 million, offset by lower project materials costs of $0.1 million and lower payments to consultants in the research and development group of $0.1 million. At March 31, 2005 the Company had cash on hand of $1.2 million and working capital of $3.7 million. During the first quarter of 2005 net cash of $0.4 million was used by operations, including $0.3 million from changes in operating assets Operating Assets Another term for working capital. and liabilities. Cash of $1.26 million was used to retire early one-half of the Company's Series C Subordinated Convertible Debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. , as was previously reported. These debentures were originally scheduled to mature December 31, 2005. The maturity date for the balance of the debentures was extended to April 30, 2006. Chyron Corporation With unwavering clarity of vision, Chyron continues to define and dominate the world of broadcast graphics. Winner of numerous awards, including two Emmys, Chyron has proven itself as the undisputed leader in the industry. From the compact Micro-X to the blazing Hyper-X SD/HD, Chyron's exceptional Duet product line brings unmatched, 2D and 3D graphics creation and performance to the most demanding studio and mobile operations. Rounding out Chyron's graphics offerings are still and clip servers, ticker and telestration systems, and MOS (1) (Metal Oxide Semiconductor) See MOSFET. (2) (Mean Opinion Score) The quality of a digitized voice line. It is a subjective measurement that is derived entirely by people listening to the calls and scoring the results from newsroom integration solutions. The ChyTV product line leverages Chyron's broadcast expertise with video graphics devices for microcasting and digital displays. Chyron has a unique, 30-year history of service and support for its products that far exceeds that of most manufacturers. For more information about Chyron products and services, please visit the company website at www.chyron.com (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB: CYRO). 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, new technologies that could render certain Chyron products to be obsolete, 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 and expansion into new markets.
CHYRON CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Three Months Ended
March 31,
2005 2004
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Net sales $5,975 $5,760
Gross profit 3,499 3,518
Operating expenses:
Selling, general and administrative 3,001 2,410
Research and development 726 905
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Total operating expenses 3,727 3,315
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Operating (loss) income (228) 203
Interest expense (66) (153)
Interest income 34 14
Other (expense) income, net (16) 262
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Net (loss) income $(276) $326
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Net (loss) income per share - basic and diluted $(0.01) $0.01
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Weighted average number of common and
common equivalent shares outstanding:
Basic 41,329 40,716
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Diluted 41,329 41,236
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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands)
March December
31, 31,
2005 2004
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Assets:
Cash and cash equivalents $1,184 $2,855
Accounts receivable, net 4,470 3,388
Inventories, net 2,398 2,570
Other current assets 754 718
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Total current assets 8,806 9,531
Non-current assets 704 774
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Total assets $9,510 $10,305
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Liabilities and shareholders' deficit:
Current liabilities $5,070 $5,758
Non-current liabilities 6,032 5,868
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Total liabilities 11,102 11,626
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Shareholders' deficit (1,592) (1,321)
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Total liabilities and shareholders' deficit $9,510 $10,305
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