During this conference call, management may make forward-looking statements within the meaning of the Safe Harbor provided by the SEC for such statements, including statements regarding the company’s expected financial position and operating results, its business strategy, its financing plans, and the outcome of certain contingencies.These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those included in or implied by any forward-looking statements and should be considered in conjunction with cautionary statements included in our press release, and our most recent reports containing Risk Factors filed with the Securities and Exchange Commission, including our most recently filed Forms 10-Q and 10-K. I’ll now turn the call over to New Frontier Media’s Chief Executive Officer, Michael Weiner. Michael Weiner Thank you, Grant, and good morning. New Frontier Media maintained solid operations during the third quarter of fiscal year 2012. With the Transactional TV segment, we continue to make progress towards executing our domestic and international strategies. Domestically, we have rolled out new and unique content packages including short-form, lower price content in many of the top 10 cable operators in the U.S. We have also begun to offering subscription VOD services in select markets. We continue to believe these efforts as well as our other initiatives will help return domestic revenue to a growth trend. Internationally, the Transactional TV segment continues to pursue opportunities to launch new services and expand existing services. International revenue represents our strongest opportunity for growth within the Transactional TV segment. Within the Film Production segment, operating income improved year-over-year primarily due to our efforts to reduce the overhead of the segment. We are focusing our efforts on obtaining higher quality content and further leveraging our relationships with cable and satellite operators by distributing the main stream content on VOD and pay-per-view platforms. We continue to believe that there are opportunities for us to further improve the results in the Film Production segment.
On a consolidated basis, our operating cash flow was positive and we expect that cash flow for the company will continue to be positive for the foreseeable future. We ended the quarter with 11.7 million of cash, additionally we received approximately $800,000 of cash in January 2012 from a tax refund and expect to receive an additional 2.3 million in cash during the first half of fiscal year 2013 from the delivery of the Film Production segment’s episodic series.We also continue to believe our stock price is undervalued considering our strong balance sheet and cash flow. During the quarter, we had an opportunity to repurchase a large block of approximately 2.1 million shares. We believe the repurchase of shares was a good use of our capital considering the depressed value of our stock. Year-to-date we have repurchased approximately 3 million shares or $3.5 million worth of stock. We plan to continue to look for other opportunities to allocate our capital in a manner that will generate a return for shareholders. New Frontier Media is well-positioned to improve its performance in the future and we believe the execution of our strategies will result in improved shareholders return over the long-term. Now I’ll turn it over to Grant for the results. Grant Williams Thank you, Michael. I’ll start the financial review this morning by discussing the third quarter operating performance by business segment, and then briefly discuss the liquidity position of the company before opening up the call for questions. For the Transactional TV segment, revenue in the third quarter declined to $8.4 million as compared to $8.8 million in the same prior year quarter. Domestic VOD revenue declined by approximately $0.4 million, due to lower revenue from the largest cable operator in the U.S. and we believe this decline was due to continued weakness in consumer discretionary spending and competition from other alternative products such as lower cost and free internet websites. Domestic pay-per-view revenue was also slightly lower due to a decline in revenue from the second largest satellite provider in the U.S. due to increased competition on that customer’s platform. International VOD and pay-per-view revenue were flat. Cost of sales for the segment increased by $0.8 million due to a one-time $0.5 million increase in expenses associated with the assumption of certain customer transport costs and $0.3 million in additional costs incurred to support the distribution of new domestic content packages. Read the rest of this transcript for free on seekingalpha.com