All figures are in Canadian dollars unless otherwise stated. IDC’s sequential quarterly results were impacted by a slowdown in economic activity, with a decrease in revenues of 12 percent from 1Q FY2012 to 2Q FY2012. This economic uncertainty was identified in IDC’s 1Q results as being an ongoing factor. IDC’s gross margins improved by 8 percentage points compared to 1Q FY2012 as a result of ongoing design and manufacturing cost efficiencies and changes in product mix during second quarter FY2012. Operating costs declined by 5 percent over 1Q FY2012 and net earnings increased to $88,000 in 2Q FY2012 from a loss of $511,000 in 1Q FY2012. Notwithstanding the decline in revenue, higher margins and lower operating expenses led to a positive EBITDA1 of $313,000 in the quarter from a loss of $243,000 in the prior quarter.
Note that the results in 2Q FY2011 were positively impacted by the roll-out of digital cinema products related to the FIFA 2010 World Cup.
International Datacasting showed a stronger first half FY2012 compared to the same six month period in FY2011. IDC posted revenues of $15.7 million in the first half FY2012, up 13 percent from $14 million in the same period FY2011. Revenues increased by 18 percent, when excluding the impact of changes in foreign exchange from the relative strengthening of the Canadian dollar. The first half of FY2012 also showed an increase in gross margins to 48 percent in the IDC Product segment compared to 43 percent for the IDC Product segment in the first half of FY2011.
“We realized some effect of the global economic slowdown in the second quarter as expected,” stated Adam Adamou, IDC Executive Chairman. “While our revenues were lower, our gross margins improved due to ongoing product line enhancements and cost efficiencies in manufacturing. This resulted in an increase in our gross profits versus the prior quarter. We remain cautiously optimistic that our economic activity for the second half of the year will be stronger than in the first half. IDC continues to strengthen our core product offerings for broadcasters worldwide,” stated Frederick Godard, IDC President & CEO. “With a focus on emerging geographic markets, product innovation, and a tight control on costs, our goal is to weather the near term economic uncertainty without losing site of operating efficiency or customer’s interests. We expect to stay ahead of the competition curve in this evolving content distribution market.” More info at the Company's website.