Avid Restatement

[Craig Seeman]

https://www.bostonglobe.com/business/2014/09/12/avid-moves-toward-nasdaq-relisting/iH9rEmf1VPTQMcOibKhVtJ/story.html

But the filing, which includes the company’s annual report for the fiscal year ended Dec. 31, 2013, makes it clear that revenue has been falling, which it blamed on an accounting rules change. In 2011, Avid reported revenue of $766,885. In 2013, Avid said it generated revenue of $563,412, it said.

So that’s declining revenues according to this. Those revenue numbers look very low as well if there are no hidden zeros. Hundreds of thousands of dollars only?

[Franz Bieberkopf]

[Craig Seeman] “Those revenue numbers look very low as well if there are no hidden zeros.”

Craig,

Follow my link … the zeros are hidden.

Between this and Reuters describing Adobe’s “web-based subscription for its Creative Suite 6” in Marcus’ link the other day, online business journalism continues its decline.

Franz.

[Craig Seeman]

[Franz Bieberkopf] “online business journalism continues its decline.”
Sloppy business journalism for sure. Considering the importance of numbers it’s tragically unforgivable.

I do see this in the article you link to.

Revenues for the twelve-month periods ended December 31, 2013 and 2012 were $563.4 million and $635.7 million

That’s
2012 $635.7 million
2013 $563.4 million
and

GAAP net income for the twelve-month periods ended December 31, 2013 and 2012 was $21.2 million and $92.9 million, respectively.

Which is
2012 $92.9 million
2013 $21.2 million

and
Adjusted EBITDA was $80.3 million and $117.8 million for the twelve-month periods ended December 31, 2013 and 2012, respectively.

Which is
2012 $117.8 million
2013 $80.3 million

These are all declines. Of course we’ll need to see previous years to note trends and/or any interruptions/anomalies in them.

[Franz Bieberkopf]

[Craig Seeman] “These are all declines.”

Craig,

Yes. It’s also funny to see the new “bookings” terminology thrown in there. (And bookings are up!)

Nonetheless, these are profits and I think it shows 3 years of profits after years of losses. (Unless I’m reading this all wrong.)

That’s remarkable and I’m surprised there hasn’t been more made of it.

Franz.

[Franz Bieberkopf]

Craig,

Reference on losses:
https://forums.creativecow.net/readpost/335/21986

Loses 2008-2010
https://finance.yahoo.com/q/is?s=AVID&annual
Dec 31, 2010 (36,954)
Dec 31, 2009 (68,355)
Dec 31, 2008 (198,177)

Using the same line (“Net Income”) as you use to measure the losses above, profits are either:

2011 +192,398
2012 + 90,016
2013 + 57,160

or

2011 +162,460
2012 + 47,087
2013 + 21,153

… zeroes hidden.

Isn’t this the headline?

Franz.

[Craig Seeman]

That the numbers are dropping again can indicate that the gains were temporary and possibly centered around the EOL of FCP7. As Adobe picks up in some high end facilities Avid is again declining.

[Scott Witthaus]

I don’t think so. At least not for the last three years. I would doubt a company in a profit would have so many changes as Avid did.

I watched the 17 minute investor relations video from the CFO and it seemed he danced around any bottom-line figures about a profit. Through cost cutting things look better, but not from a huge jump in actual sales. I really don’t think the FCP7 EOL made more than a blip for Avid. Adobe won that race.

I think they are on a good course, but their cash position is way down (historically) and it looks like for the first time in a while they have debt ($5million). The 2014 numbers will be more interesting as there will be a surge in revenue based on the new subscription model that Avid is forcing it’s loyal users.

Scott Witthaus
Senior Editor/Post Production Supervisor
1708 Inc./Editorial
Professor, VCU Brandcenter

[Franz Bieberkopf]

[Craig Seeman] “As Adobe picks up in some high end facilities Avid is again declining.”

Craig,

Maybe. They’re projecting a rise in profit for 2014.

Franz.

[Mark Suszko]

When the arbitragers and speculators and financier types start controlling the company, so that accounting trickery is put ahead of new product development, or customer service, I think you have the beginnings of a long downward slide. Shareholders will still be happy. But how many others?

[Craig Seeman]

[Franz Bieberkopf] “Maybe. They’re projecting a rise in profit for 2014.”

Anything is possible but the numbers do point down, not up.
One might guess that 2012 was a bump up given the history of losses but we won’t know that for sure until we see the revised 2011 numbers. The drops from 2012 to 2013 look relatively large though.

BTW in theorizing about the FCP7 EOL it’s not that suddenly MC sales lifted them, it’s the move away from FCP7 might have included a move to Avid’s storage systems where they make their bigger money, as some large clients move back to MC/Symphony.