Thursday November 11, 4:19 pm Eastern Time
Company Press Release
VDI MultiMedia Earnings Hit Record Highs
EPS for the Quarter Up 18% to $0.20
HOLLYWOOD, Calif.--(BUSINESS WIRE)--Nov. 11, 1999--VDI MultiMedia (Nasdaq:VDIM - news) Thursday announced unaudited results for the three- and nine-month periods ended September 30, 1999.
Revenues for the quarter ended September 30, 1999, increased 24 percent to $20.4 million from $16.4 million during the same quarter in the prior year. Gross profit for the third quarter grew to $7.8 million from $6.5 million for the three-month period ended September 30, 1998. Income from operations for the third quarter increased to $3.7 million from $3.1 million for the corresponding quarter in the prior year.
Net income for the quarter grew 15 percent to $1.9 million from $1.6 million in the quarter ended September 30, 1998. Net income per share for the third quarter was $0.20, vs. $0.17 for the same quarter in the prior year.
The result of operations for the third quarter included $0.3 million, or $0.02 per share, of nonrecurring costs associated with the consolidation of facilities and integration of operations related to recent acquisitions.
For the nine-month period ended September 30, 1999, revenues increased to $58.8 million from $42.3 million for the nine months ended September 30, 1998. Gross profit grew to $23.8 million from $16.7 million, and income from operations increased to $10.6 million from $7.8 million for the same period in the prior year.
Net income for the nine-month period ended September 30, 1999, increased 23 percent to $5.3 million from $4.3 million in the prior year. Net income per share for the nine months ended September 30, 1999, grew to $0.56.
Donald R. Stine, President of VDI MultiMedia, commented, ''Having completed the integration of two large acquisitions this year and having expanded several other facilities, we are pleased that earnings have grown so impressively. VDI is now well-positioned to grow the top and bottom lines of its core business, while expanding into new business lines such as high-definition TV services and the digital distribution of advertising.
''By combining our two primary facilities in Hollywood, VDI has created what we believe is the largest broadcast-quality digital duplication facility in the country. Unexpected construction delays led to non-recurring expenses this quarter that negatively impacted earnings. However, the economies of scale that this flagship facility creates will continue to drive increases in our operating margins going forward.
''VDI continues to grow its core client base. This quarter we finalized a preferred vendor agreement with NBC, who is a neighbor of our upgraded Burbank facility. VDI is also now a preferred vendor at three of the major motion picture studios. Our broadcast sales group added several important advertising clients this quarter, including Coors Brewing Company.''
Brian Grant, Vice President of Business Development, added, ''We have responded to rapid growth in the DVD market by hiring Tom Attalla as our new Vice President of Compression & DVD Services. With the installed base of DVD players expected to double this year, we believe the demand for DVD authoring will grow rapidly. Mr. Attalla supervised the production of over 100 DVD titles in his previous position at Universal Studios. He will lead our efforts to sell complete DVD solutions to motion picture studios and distributors. Additionally, he will sell MPEG compression services to content owners wishing to digitize and distribute video over the Internet.''
Clarke Brewer, Chief Financial Officer, concluded, ''VDI's financial strength continues to lead the industry, as demonstrated by our operating cash flow (operating income before depreciation and amortization) of approximately $5.0 million, or $0.54 per share, for the quarter. With a new enterprise system coming online in the fourth quarter of this year, we expect further reductions in our cost drivers and improvements in the speed and efficiency of our financial reporting. This system will further increase our ability to cross-sell services between our nationwide facilities, and will allow for advanced e-commerce applications.''
VDI MultiMedia is one of the largest providers of video and film asset management services to owners, producers and distributors of entertainment and advertising content. VDI provides the services necessary to edit, master, reformat, archive and ultimately distribute its clients' film and video content, including television programming, spot advertising, feature films and movie trailers.
The company provides worldwide electronic distribution, using fiber optics, satellites, and the Internet, through its Broadcast One® network. The company delivers commercials, movie trailers, electronic press kits, infomercials and syndicated programming, by both physical and electronic means, to hundreds of broadcast outlets worldwide.
VDI's interconnected facilities in Los Angeles, New York, Chicago, Dallas and San Francisco provide service coverage in each of the major U.S. media centers. Clients include major motion picture studios such as Universal, Disney, Fox, Sony Pictures, Paramount, MGM, and Warner Bros. and advertising agencies TBWA Chiat/Day, Saatchi & Saatchi and Young & Rubicam.
Certain statements in this news release contain ''forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, without limitation, (i) the company's projected revenues, earnings, cash flow and EBITDA and related per-share amounts for any of the quarters or the year ending December 31, 1999; (ii) statements of the company's management relating to business line expansions and the consolidation of acquisitions; (iii) statements concerning reduction of facilities and actions to streamline operations; (iv) steps being taken to reduce costs and improve customer service; (v) statements regarding new business and new acquisitions. Such statements are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the company to be materially different from those expected or anticipated in the forward-looking statements. In addition to the factors described in the company's SEC filings, including its quarterly reports on Form 10-Q and its annual reports on Form 10-K, the following factors, among others, could cause actual results to differ materially from those expressed herein: (a) lower than expected net sales, operating income and earnings in 1999; (b) less than expected growth, even following the company's focus on streamlined operations; (c) actions of competitors including business combinations, technological breakthroughs, new product offerings and marketing and promotional successes; (d) the risk that anticipated new business may not occur or be delayed; and, (e) general economic conditions that adversely impact the company's customers' willingness or ability to purchase or pay for services from the company. The company has no responsibility to update forward-looking statements contained herein to reflect events or circumstances occurring after the date of this release. |
