Pilat Media, the London based supplier of business process management software for broadcasting companies, posted a mixed bag of results for FY11 as costs to bring implementations live and the effect of a legal settlement took it into a loss despite higher revenues.
The company regularly raises revenue and for the year to December 31 2011, revenue was up 3% to £22.5m but costs outweighed the gains. There was little it could do about unexpected legal action from its client Fox Television Stations (see Pilat profitability impacted by legal action), but the situation cost it dearly. Although it was settled out of court with a payment to Pilat of c£544k, the impairment of the receivable of £2.3m caused a loss after tax of £0.86m compared to a profit of £1.6m in the previous year. Revenues from the America’s (its largest market – 46% of total revenues in 2011) were down 25%.
The company was also impacted by work to finish implementations started during 2011 or before that required higher effort than planned, reducing its margins. The operating profit (before the impairment of receivable and amortisation of intangible assets) was down on the previous year at £2.4m, vs £3.2m.
On the positive side its lower cost MediaPro product is going well, attracting new contracts and IBMS revenues are rising, which combined to boost EMEA revenues by 43% over the year. Reassuringly, the company is generating cash, with the pile increasing to £6.7m from £3.8m, which puts it into a strong position for 2012.
The company is experiencing turbulence but changes within the broadcasting sector means there is still scope for growth if it can pull its costs into line. Capabilities such as its rights management, metadata repository and workflow engine will be important in supporting the new broadcasting/viewing model of TV everywhere and anytime. The absence of references to any specific contract wins was surprising and probably reflects lower overall spending and smaller deals.