Broadcast International Announces Quarterly Results

SALT LAKE CITY, May 18, 2011 /PRNewswire/ -- Broadcast International (OTC Bulletin Board: BCST) announced that its revenues for the three months ending March 31, 2011 were $1,687,264. During the same period in 2010, revenues were $1,787,067. The $99,803 decrease is due primarily to certain additional services in our BI Networks business in 2010 that were not repeated in 2011. Gross Profits were $411,727 in first quarter 2011 compared to $514,024 for the same period last year. The Operating Loss of $3,135,146 for this quarter is $1,426,973 higher than first quarter 2010 due almost entirely to non-cash compensation. Net Loss this quarter was only $746,965 compared to a Net Loss of $2,900,731 in first quarter 2010. The $2.2 million reduction in Net Loss is due largely to lower interest expense of $1,333,836, a $3,701,300 higher gain on derivative valuation, only partially offset by warrant costs of $476,234 and a loss of $970,033 on the extinguishment of debt.

According to Rod Tiede, President and CEO, "The close comparability of this quarter's performance to first quarter of last year reflects the ongoing revenue contribution from our largest BI Networks' customer.  We anticipate making additional installations under that contract during the next few quarters and expect our revenues to grow. Our pipeline of potential revenue generating deals is robust, including multiple opportunities that are equal or greater in potential than our current largest customer.  With our newly strengthened working capital position, we are well positioned to compete in more opportunities within the growing digital signage and enterprise video markets."

Broadcast's CodecSys Division introduced its patented Intel-version software-based video compression encoder (Version 2.0) in third quarter 2010. CodecSys has established co-marketing partnerships with IBM, HP and Microsoft in which CodecSys may be included in their product bids. The timing of our future CodecSys sales continue to be difficult to project as sales cycles have been longer than envisioned and specific customer customization has been greater than anticipated. However, we fully expect that our early efforts toward seeding our partner customers with pilot evaluation units will begin to drive meaningful revenue in fiscal 2011.  Presently our partners have helped us to place 21 of our 24 evaluations systems with their customers who are contemplating the purchase of large amounts of hardware from those partners, largely within the IPTV market. Our level of activity is growing.

About Broadcast International

Broadcast International is a leading provider of video-powered broadcast solutions, including IP, and digital satellite, Internet streaming and other types of wired/wireless network distribution. BI's patented CodecSys software is a breakthrough, multi-codec video compression technology that cuts video bandwidth requirements over satellite, cable, IP and wireless networks. By slashing bandwidth needs, CodecSys enables a new generation of applications such as streaming video to cell phones, and offers unprecedented price/ performance benefits for existing applications such as HD video.

Broadcast International is a public company (OTC Bulletin Board: BCST.OB - News) headquartered in Salt Lake City, UT. For more information visit: www.brin.com and www.codecsys.com.

Forward-Looking Statements

All statements in this news release that are not based on historical fact are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). While management has based any forward-looking statements contained herein on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties, and other factors, many of which are outside of our control, that could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not necessarily limited to, those set forth under the caption "Additional Factors That May Affect Our Business" in the Company's most recent Form 10-K and 10-Q filings, and amendments thereto. In addition, we operate in a highly competitive and rapidly changing environment, and new risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. We disclaim any intention to, and undertake no obligation to, update or revise any forward-looking statement.

SOURCE Broadcast International