Haivision Announces Results for the Fourth Quarter and Full Year Ended October 31, 2021

Haivision reports record fourth quarter performance with 22.3% year-over-year revenue growth

MONTREAL, Jan. 25, 2022 /CNW/ - Haivision Systems Inc. ("Haivision" or the "Company") (TSX: HAI), a leading global provider of mission critical, real-time IP video solutions, today announced its results for the fourth quarter and year ended October 31, 2021.

Mirko Wicha, Chairman and CEO of Haivision said, "Fiscal 2021 has been our best year ever, beginning with a monumental initial public offering. This was followed by the impactful acquisition of CineMassive, a significantly enhanced credit facility with BMO, and the launch of two key SaaS platforms."

Q4 2021 Financial Results

• Revenue of $27.1 million, up 22.3% from $22.1 million in the fourth quarter of fiscal 2020, a record quarterly performance.
• Thirty-second consecutive quarter of positive Adjusted EBITDA*.
• Net income for the quarter was $0.2 million.

Fiscal 2021 Financial Results

• Revenue of $92.6 million, up 11.4% from $83.1 million in fiscal 2020, a record annual performance.
• Adjusted EBITDA* of $12.3 million up 24.6% from $9.9 million in fiscal 2020.
• Adjusted EBITDA Margin* of 13.3% up from the 11.9% realized in fiscal 2020.
• Fourteenth consecutive year of positive Adjusted EBITDA*.
• Net loss for the year was $8.8 million, a decrease of $14.6 million from prior year, but impacted by share based payment of $16.8 million.
• Extinguished all bank debt.
• Cash at year end was $26.8 million.

Key Company Highlights for Fiscal 2021

• Our SRT open-source initiative celebrated its 4th anniversary, added its 500^th member and welcomed industry stalwarts like Google, Sony, SK Telecom, and Lumen Technologies.
• Launched two SaaS platforms: Haivision Connect, a new platform for simplifying video streaming for the house of worship market and Haivision Hub, a new platform that simplifies the broadcaster's challenge of routing video through the cloud at a global scale.
• Awarded Streaming Media Readers' Choice Award for best Corporate Video and Enterprise Video Content Management Platform.
• Acquired CineMassive Displays, LLC a leader in visual collaboration solutions for mission critical operations.
• Secured a $35 million revolving credit facility with BMO with an accordion feature to expand the line to $60 million.
• Eliminated all corporate debt (including the PPP loan granted under the CARES Act which was forgiven by the Small Business Administration).
• Added three outside Board members including Julie Tremblay, Sidney Horn and Major General Lee K. Levy II, USAF (ret).
• Introduced an Employee Share Purchase Plan (ESPP) to provide ownership opportunities to employees.

"We are excited about the recent CineMassive acquisition and have already derived synergies with the respective teams cross-selling solutions into their client bases within enterprise and defense," said Mirko Wicha, Chairman and CEO of Haivision. "In addition, our broadcast business continues to thrive with our solutions that are tailored to today's much needed remote workflows." 

"Furthermore, our ability to generate Adjusted EBITDA and net income has exceeded our expectations thus far, as we maintain our focus on operational efficiency and executing our acquisition strategy," added Mr. Wicha.

Fourth Quarter 2021 Financial Results

Fourth quarter revenues of $27.1 million, represented a 22% increase compared to the prior year revenue of $22.1 million in the same period.  The recent CineMassive acquisition contributed $5.1 million to overall revenue.  Gross Margins* for the quarter were 70.8% compared to 76.4% for the same period in the prior year.  The decrease in Gross Margins* results largely from the addition of CineMassive's business which historically operated at a lower overall gross margin than Haivision's traditional business. Adjusted EBITDA* in the quarter of $1.8 million was largely flat with the prior year, but highlights an opportunity for operational efficiencies from the combined entity.  Net income for the quarter was $0.2 million compared to $1.5 million in the prior year period, impacted by share-based payment, amortization and depreciation related to the CineMassive acquisition and the costs of being a public issuer.  

Fiscal 2021 Financial Results

Fiscal 2021 revenues of $92.6 million represented an 11% increase compared to the prior fiscal year's revenue of $83.1 million. Gross Margins* for the fiscal year were 74.9% compared to 76.7% in the prior fiscal year.

The operating loss for fiscal 2021 was $5.5 million but was impacted by $18.6 million in non-cash, share-based payment, including $14.2 million in non-cash, share-based payment related to the legacy Employee Stock Option Plan ("ESOP"). Options governed by the legacy ESOP were only exercisable upon the occurrence of a liquidity event (such as our initial public offering earlier in the year).  Adjusted EBITDA* for the full year ended October 31, 2021 was $12.3 million an increase of 24.3% compared to fiscal 2020, and a higher growth rate than revenue.  Dan Rabinowitz, Chief Financial Officer and EVP Operations, stated, "We are proud of our fiscal 2021 performance having demonstrated operations efficiencies in a tough environment.  Our results continue to be strong despite the industry faced with constrained supply chains, a difficult hiring environment, and fundamental changes in business operations due to the pandemic. Our performance is even more impressive if you take into consideration the significant added expense of being a public company."

Conference Call Notification

Haivision will hold a conference call to discuss its fourth quarter financial results on Tuesday,
January 25, 2022 at 5:30 pm (ET).

To register for the call, please use this link http://www.directeventreg.com/registration/event/5238868. After registering, a confirmation will be sent through email, including dial in details and unique conference call codes for entry.

* Represents a non-IFRS measure. For the relevant definition, see "Non-IFRS Measures" below. As applicable, a reconciliation of this non-IFRS measure to the most directly comparable IFRS financial measure is included in the tables at the end of this press release and in the Company's management's discussion and analysis for the three months and full year ended October 31, 2021.

Financial Statements, Management's Discussion and Analysis and Additional Information

Haivision's consolidated audited financial statements for the full year ended October 31, 2021 (the "2021 Annual Financial Statements"), the management's discussion and analysis thereon and additional information relating to Haivision and its business can be found under Haivision's profile on SEDAR at www.sedar.com. The financial information presented in this release was derived from the 2021 Annual Financial Statements.

Forward-Looking Statements

This release includes "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of applicable securities laws, including, without limitation, statements regarding the Company's growth opportunities and its ability to execute on its growth strategy. In some cases, but not necessarily in all cases, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "is positioned", "estimates", "intends", "assumes", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will" or "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking statements. Forward-looking statements are not historical facts, nor guarantees or assurances of future performance but instead represent management's current beliefs, expectations, estimates and projections regarding future events and operating performance.

Forward-looking statements are necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by Haivision as of the date of this release, are subject to inherent uncertainties, risks and changes in circumstances that may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ, possibly materially, from those indicated by the forward-looking statements include, but are not limited to, the risk factors identified under "Risk Factors" in the Company's latest annual information form, and in other periodic filings that the Company has made and may make in the future with the securities commissions or similar regulatory authorities in Canada, all of which are available under the Company's SEDAR profile at www.sedar.com. These factors are not intended to represent a complete list of the factors that could affect Haivision. However, such risk factors should be considered carefully. There can be no assurance that such estimates and assumptions will prove to be correct. You should not place undue reliance on forward-looking statements, which speak only as of the date of this release. Haivision undertakes no obligation to publicly update any forward-looking statement, except as required by applicable securities laws.

Non-IFRS Measures

Haivision's consolidated financial statements for the year ended October 31, 2021 are prepared in accordance with International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board. This press release makes reference to certain non-IFRS measures, including "EBITDA", "Gross Margin", "Adjusted EBITDA" and "Adjusted EBITDA Margin". These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS, and are therefore unlikely to be comparable to similar measures presented by other companies. Accordingly, these measures should not be considered in isolation or as a substitute for analysis of our financial information reported under IFRS. Rather, these non-IFRS measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Our management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation.

Adjusted EBITDA is a supplemental measure used by management to assess the financial performance of our business. Adjusted EBITDA is also a key metric that management uses prior to execution of any strategic investing or financing opportunity. "EBITDA" is defined as earnings (loss) before income taxes, depreciation, amortization and financial expenses and "Adjusted EBITDA" is defined as EBITDA, as adjusted for stock-based compensation and certain non-recurring expense items. "Adjusted EBITDA Margin" represents Adjusted EBITDA divided by revenue. "Gross Margin" represents gross profit divided by revenue. "Gross Margin" represents gross profit divided by revenue.

A reconciliation of EBITDA and Adjusted EBITDA to Net income (loss) is included in the tables at the end of this press release and in the Company's management discussion and analysis for the three months and full year ended October 31, 2021.

About Haivision

Haivision is a leading global provider of mission-critical, real-time video streaming and networking solutions. Our connected cloud and intelligent edge technologies enable global organizations to engage audiences, enhance collaboration, and support decision making. We provide high quality, low latency, secure, and reliable live video at a global scale. Haivision open sourced its award-winning SRT low latency video streaming protocol and founded the SRT Alliance to support its adoption. Awarded an Emmy® for Technology and Engineering from the National Academy of Television Arts and Sciences, Haivision continues to fuel the future of IP video transformation. Founded in 2004, Haivision is headquartered in Montreal and Chicago with offices, sales, and support located throughout the Americas, Europe, and Asia. Learn more at haivision.com. 

SOURCE Haivision Systems Inc.