KIT digital (KITD)
Q2 2012 Earnings Call
August 14, 2012 5:00 pm ET
Murray Arenson - Senior Vice President of Investor Relations & Corporate Initiatives
Barak Bar-Cohen - Chief Executive Officer, Chief Administrative Officer and Director
Fabrice Hamaide - Chief Financial Officer
Richard Ingrassia - Roth Capital Partners, LLC, Research Division
Todd Van Fleet - First Analysis Securities Corporation, Research Division
Darren Aftahi - Northland Capital Markets, Research Division
Steven B. Frankel - Dougherty & Company LLC, Research Division
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Good day, ladies and gentlemen. My name is Alicia, and I'll be your conference operator today. At this time, I'd like to welcome everyone to KIT digital's First Quarter 2012 Earnings Conference Call. [Operator Instructions] Before I introduce our host, I will read the following Safe Harbor statement.
During this call, management may make certain forward-looking statements related to the business of KIT digital, Inc., which can be identified by the use of forward-looking statements terminologies such as believes, expects, plans, intends, anticipates and variations of such words or similar expressions. Their absence does not mean that the statement is not forward-looking. Statements made during this call that are forward-looking include, but are not limited to, statements made by the management concerning the company's shift in its growth strategy, the financial results for the remainder of its fiscal year ending December 31, 2012, strategic transactions processed and the company's plans for the possible divestiture of noncore assets.
Such forward-looking statements involve known and unknown risks and uncertainties, including uncertainties relating to products, development and commercialization; integration of acquired businesses and ability to obtain or maintain patent or other proprietary intellectual property protection; market acceptance; future capital requirements; regulatory actions or delays; competition in general; and other factors that may cause actual results to be materially different from those expressed herein. Certain of these risks and uncertainties are or will be described in greater detail in the company's public filings with the U.S. Securities and Exchange Commission. Except as required by U.S. federal securities laws, KIT digital is under no obligation to, and expressly disclaims any such obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
It is now my pleasure to turn the call over to our host, Murray Arenson, Managing Director of Financial Strategy. Please go ahead, sir.
Thank you, Alicia. Thank you, everyone, for joining us for our second quarter 2012 conference call to review our financial results, our strategy, our operations and our outlook. With me today on the call are Barak Bar-Cohen, our Chief Executive Officer; and Fabrice Hamaide, our Chief Financial Officer.
The format of our call today will be as follows: Barak will offer some comments on the scope and depth of our achievements internally over the past 3 months, along with some operational and financial highlights. Fabrice will then provide a more detailed review of the quarter's results and related financial activities and metrics, along with an update regarding our financial outlook. Then Barak will have some final thoughts regarding our strategy and opportunity. Finally, we'll open up the call for questions and answers.
And with that, I will turn the call over to Barak.
Thank you, Murray, and thank you, everyone, for joining us on our second quarter 2012 earnings conference call. Let me begin by saying that we have achieved much in a short amount of time, thanks to a revitalized executive team, a reconstituted board of directors and, most importantly, the passion and hard work of our dedicated employees around the world.
Now beginning in April, we launched what became a series of 48-hour sprints to tackle multiple discrete challenges the company was facing, issues such as liquidity issues, legal issues, strategic process and operational and financial controls. Now the management team prioritized each period's task and concentrated our energies entirely on completing the most pressing tasks. Our business has now settled into a much more normalized operating rhythm, and I am happy to say that the drive and discipline of those first few weeks is still very much a part of our culture. We took actions to resolve the immediate challenges facing our business. Now these actions reinforce our organization's core principles: a commitment to cutting-edge technology, a customer-focused service mentality and a belief in the power of video.
Now as reported in our 10-Q filing, this quarter illustrates the continuing transformation of our business and sharper focus on our core value proposition of delivering IP video software and services to leading broadband media companies around the world. Now by broadband media companies, we mean the world's leading telcos, network operators, broadcasters and key brands now leveraging IP video to increase their market presence. Our value proposition for that core customer base is grounded in a combination of software, which is our Cosmos video platform; and services, which is managed services, to operate deployed systems; and professional services to execute new deployments and ongoing project work.
Among the industry leaders that we serve today in this market are companies such as AT&T, Mediaset, BSkyB, Channel 4 and Sky Italia. Our unique combination of software and services is unmatched in the industry and will be the core of our future growth.
Now this quarter featured new business to customers in Turkey, Thailand, Australia, Mexico, the United States, Italy, the U.K. and the Middle East, just to highlight a few. In addition to new business, we accomplished much in these past few months. We completed the divestiture of our noncore Content Solutions business. We reduced low-margin hardware business in the broadcast space. We completed the acquisition of Hyro, providing essential strength to the AsiaPac team. We raised over $29 million in much needed capital. We moved the corporate headquarters to New York City. We hired a new CFO sitting by my side with strong turnaround and financial operating experience. We appointed a new CTO, Mark Christie, with strong platform and broadband media deployment expertise. We implemented a new system for cash management and budgeting and forecasting. We signed several major new clients around the world. And, we added 4 new board members, including a new nonexecutive chairman, a new Audit Committee chairman and representatives of 2 major shareholders.