KIT digital to Use Proceeds of $55 Million Equity Offering to Expand Market Share in IP Video Manage
Management provided details of this plan and answered analysts' questions today on a conference call that is available for replay on the company's website at www.kitd.com.
"We believe our profitable operations, transparent capital structure, balance sheet strength, and management team depth are unique assets in our competitive arena," said Kaleil Isaza Tuzman, KIT digital's chairman and CEO. "We are committed to extending our market share leadership in the video asset management software (VAMS) space, and this financing, which brings our cash level to over US$75 million, provides us the resources to efficiently execute on our acquisition plan over the next 12 to 18 months without needing to repeatedly access the capital markets."
KIT digital is the number one global provider of enterprise IP video management software, with more than 1,000 enterprise customers across 30+ countries, including The Associated Press, Best Buy, Bristol-Myers Squibb, Disney-ABC, FedEx, General Motors, Google, Hewlett-Packard, Home Depot, Intel, News Corp, Telefonica, U.S. Department of Defense, Verizon, and Vodafone.
"Our measured pace and disciplined 'buy versus build' analytical approach to acquisitions will continue to be applied," said Isaza Tuzman, "and we will continue to insist on 'day one' accretive transactions -- on both a revenue and cash-flow multiple basis, as well as on a cash-flow margin basis. As we have done in the past, we will target acquisitions that provide geographical and sales vertical synergies, share a similar corporate culture to our own, and constitute roughly 5%-15% of our pro forma combined revenue -- indicators which allow for smooth integration and 'on-boarding.' We find certain BRIC and emerging markets particularly attractive, given the pace of demographic and new media-specific growth in these markets."
Gavin Campion, president of KIT digital, added: "Based on what we are seeing today, we believe the next 1-2 years will be a period of accelerated green-field growth and increased corporate consolidation in the enterprise video asset management industry. This is particularly important, given that our industry has 'sticky' products and low attrition rates -- so once you expand market share you tend to keep it."
"We are absolutely committed to stay ahead of our competition as our market grows and consolidates," said Campion, "including those competitors currently pursuing capital-raising options. Our mission is to maintain operational discipline and continue to experience 60%+ of our growth profile being organic. Our overall goal is to expand our current 15%-20% global market share position to more than 50% over the next couple of years by complementing this organic growth with highly selective joint ventures and acquisitions."
Conference Call Replay Further details of the equity offering and the use of proceeds were presented in a conference call hosted by KIT digital management earlier today (April 27, 2010).
A replay of the call is available via the Investor Relations section of KIT digital's website at www.kitd.com, or by dialing:
Toll-free replay # (North America): +1-800-283-4641 International replay # (outside of North America): +1-402-220-0851 (No passcode required)
The replay will be available until May 27, 2010.
About KIT digital KIT digital (NASDAQ: KITD) is a leading, global provider of on-demand, Internet Protocol (IP)-based video asset management systems (VAMS). KIT VX-one, the company's end-to-end software platform, enables enterprise clients to acquire, manage and distribute video assets across the three screens of today's world: the personal computer, mobile device, and IPTV-enabled television set. The application of VX ranges from commercial video distribution to internal corporate deployments, including corporate communications, human resources, training, security and surveillance. KIT digital's client base includes more than 1,000 customers across 30+ countries, including The Associated Press, Best Buy, Bristol-Myers Squibb, Disney-ABC, FedEx, General Motors, Google, Hewlett-Packard, Home Depot, IMG Worldwide, Intel, News Corp, Telefonica, the U.S. Department of Defense, Verizon, and Vodafone. KIT digital is headquartered in Prague, and maintains principal offices in Atlanta, Cairo, Cologne, Dubai, Melbourne (Australia), London, New York, Stockholm and Toronto. For additional information, visit www.kitd.com or follow the company on Twitter at www.twitter.com/KITdigital.
KIT digital Forward-Looking Statement This press release contains certain "forward-looking statements" related to the businesses of KIT digital, Inc., which can be identified by the use of forward-looking terminology such as "believes," "expects," "plans" or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties, including uncertainties relating to product development and commercialization, the ability to obtain or maintain patent and 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 described herein as anticipated, believed, estimated or expected. Certain of these risks and uncertainties are or will be described in greater detail in our public filings with the U.S. Securities and Exchange Commission. KIT digital is not under 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.
KIT digital Global Contact:
Global Communications Manager
KIT digital Investor Relations Contact:
Liolios Group, Inc.
Contact for media in the Czech Republic:
Bison & Rose
Tel.: +420 777 130 788
RM-SYSTÉM, česká burza cenných papírů a.s.
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