Interim Management Statement

RNS Number : 6046Q

Vislink PLC

08 November 2012

 



8 November 2012

Vislink plc

Interim Management Statement

Vislink plc (the "Group"), the global technology business specialising in high performance wireless communications products and services for the broadcast and surveillance markets, today publishes a trading update and Interim Management Statement in respect of the financial period from 1 July 2012 to 8 November 2012, being the date of this announcement.

Trading

The Group traded in line with management expectations for the third quarter ending 30 September 2012. Year to date adjusted profit¹ for the nine months was £2.0m.

Group revenues for the nine months were £41.3m (2011: £35.0m) up 18.0% on last year, and orders received year to date were £40.4m (2011: £39.5m) up 2.3%.

The Group recently launched the Mantis MSAT portable satellite data terminal, suitable for both broadcast and surveillance markets, which has begun to make volume shipments. A £0.8m shipment of this product, originally due to be made September 2012 was delayed until early October 2012 awaiting customer sign offs. This would have had a beneficial impact on both revenue and profit for the third quarter.  The sales pipeline for MSAT continues to grow. 

The Gigawave acquisition has been fully integrated into the Group's UK operations, with associated operational efficiencies realised and the revenues being generated are in line with expectations. On finalising the valuation of assets acquired as part of the business, the planned deferred consideration to the Gigawave shareholders has been reduced, with £0.5m now payable in the fourth quarter of 2012 and £0.25m payable in the first quarter of 2013.

The Group remains debt free and after paying dividends of £1.4m in the third quarter and cash absorption from higher inventory to support MSAT shipments, the net cash balance as at the 30 September was £6.3m.

In addition the Board reaffirms that it is on track to achieve its three year financial goal of achieving £80m revenues and £8m PBT by financial year ending 2014. 

Note

¹Defined as operating profit/loss before the amortisation and impairment of goodwill and acquired intangibles, and other non-recurring costs.

Strategy

The Board revisited its three year growth plan in October 2012 and concluded that it remained on track to fulfil its strategic and financial goals.  

The core competence of Vislink is in the collection and delivery of high quality video and associated data from the field to point of usage. Vislink provides solutions to two core markets: the broadcast market for the collection of live news, sport & entertainment events and the video surveillance market including defence, law enforcement & public safety customers.

The Group will continue to exploit the strengths of our established brands - Advent, Gigawave, Link, MRC and PMR. We will also maintain investment through our core product development programme, particularly in IT based technologies such as IP transport over 3G/4G and WiFi infrastructures.

The Board believes that the Group is capable of exploiting the continuing growth of video content contribution both in its traditional broadcast markets and also in other vertical markets, providing the technologies for surveillance applications, which will be achieved through partnerships.

Vislink currently has the widest product portfolio in the broadcast contribution sector and is the number one supplier in what is today a fragmented market. Our market share currently is circa 20% of the global market which is estimated to be c.£230m and projected to grow to c.£270m by 2015.

We will continue to maintain our market-leading position with the provision of wireless video delivery and miniaturisation as demonstrated through our on-board applications in Formula 1, the Americas Cup and Moto GP. Our products maintain leading edge capabilities, tracking the trends in use of 3G/4G and IP gateway delivery technologies. We wish to extend the use of our technologies, principally through partnerships, into the semi-professional and pro-sumer market.

We plan to leverage our technologies into the surveillance markets beyond our existing defence, law enforcement and public safety customers, where we are already a leader in airborne video surveillance applications used in helicopters, the associated command and control support vehicles and hand held devices. For example, there is a growing demand for unmanned aircraft and other vehicles where our expertise in providing wireless video contribution is transferable. We plan to access these opportunities through partnerships.

We will create a software and services culture within the Group allowing us to build recurring revenues into our business model - our intention is to build more of a solutions, services and software offering to our customers. This will take us time to build but ultimately will provide the recurring revenues and visibility that our current business model does not provide us with. We will also seek "bolt on" acquisitions to strengthen our software and services capabilities, exploiting the growth of cloud based IP transport technologies and content tagging.

The financial goal is for profitable growth to £80m of annualised revenues (2010: £43.1m) within three years (year ending 31 December 2014) with an adjusted operating margin of 10%.  As stated above, the Board believes that the Group is on track to achieve this.

Summary

The Group continues to make progress, with all regions expected to contribute to profits in the fourth quarter.  The launch of the MSAT product has been successful and testament to Vislink's ability to quickly respond to customer needs with market leading products. The macroeconomic environment remains challenging, however this is mitigated by a much more efficient and scalable cost base for the business. 

The Group has returned to consistent profitability and has a realistic strategy to deliver long term growth and generate positive shareholder value.

John Hawkins

Executive Chairman

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For further information please contact:

John Hawkins, Executive Chairman	[phone]
Ian Davies, Group Finance Director	[phone]
Andrew Hayes / Charlie Jack Hudson Sandler	[phone]
Shaun Dobson N+1 Singer	[phone]

About Vislink plc

The Vislink Group is a global technology business specialising in the collection and delivery of high quality video and associated data from the field to the point of usage. Vislink provides solutions to the broadcast market for the collection of live news, sport and entertainment events and to the surveillance market including defence, law enforcement and public safety customers. With offices in the UK, USA, Australia, UAE, South Africa and Singapore we employ over 250 people worldwide and have net assets of £50m. Our solutions include the design and manufacture of microwave radio, satellite transmission and wireless camera systems; our manufacturing operations are in the UK and the USA.

The Company is fully listed on the London Stock Exchange (LSE:VLK). For further information, visit www.vislink.com.

Forward looking statements

Certain statements in this announcement are forward-looking. Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. Because these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. The Group undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. Nothing in this announcement should be construed as a profit forecast.

 

END

 

 

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