Digimarc Reports Record Profits; Declares Cash Dividend
finance.yahoo.com
Revenues for the first quarter 2012 increased 88% to $17.0 million from $9.1 million in the same quarter a year ago. The 2012 quarter reflected an $8.0 million increase in revenues primarily due to royalties paid by Verance to Digimarc in conjunction with resolution of a license dispute.
Operating income for the quarter was $9.2 million, compared to $1.4 million in the first quarter of 2011. The improvement was largely due to the payment from Verance, and a related decrease in legal fees from the associated litigation, which was resolved in January; offset by increased headcount and an additional layer of stock-based awards.
Net income for the quarter was $5.0 million or $0.70 per diluted share, which included Digimarc's share of the net loss of $1.1 million from its joint ventures with Nielsen. This compares to a net income of $0.9 million or $0.12 per diluted share in the first quarter of 2011, which also included Digimarc's share of the net loss of $0.5 million from the company’s joint ventures with Nielsen. The increase in the net loss from the joint ventures was primarily due to accrued expenses in connection with suspending operations of the joint ventures.
During the quarter, Digimarc and The Nielsen Company mutually agreed to reduce the investment in their joint ventures to a nominal level for the foreseeable future. Based on its assessment of the market and competition, Digimarc concluded that licensing its patents and technology is a better path to maximum profit than continuing to invest in an operating business to compete in the space.
At March 31, 2012, cash and cash equivalents and marketable securities totaled $44.0 million, up from $33.4 million at December 31, 2011. The increase was from improved operating results, driven primarily by increased revenues from Verance.
Given its strong operating performance and healthy cash balances, Digimarc declared a quarterly dividend of $0.11 per share on the outstanding common shares, payable on May 25, 2012, to shareholders of record at the close of business on May 11, 2012. The aggregate amount of the quarterly dividend payment is expected to be approximately $781,000. The dividend is an elaboration of the company’s capital allocation strategy that is intended to provide income to current shareholders and broaden investor interest in Digimarc. |
