Broadcast International Revenues up 41%, Gross Profits Nearly Double

SALT LAKE CITY, Aug. 12, 2011 /PRNewswire/ -- Broadcast International (BCST.OB) today announced that Second Quarter 2011 revenues reached $2.4 million, an increase of 41% over the $1.7 million revenues reported for same quarter in 2010. The Second Quarter 2011 revenues were also 41% higher than last quarter. The increased revenues are primarily from expanded digital signage installations made by the BI Networks Division for its largest customer.

Gross Profits of $737 thousand were up 99% from the same period last year and up 79 percent from First Quarter 2011. The 31% gross margin for Second Quarter is also higher than the 22% margin from the corresponding period in 2010 and the 24% margin reported last quarter. The substantial increase in Gross Profits this quarter is attributable to operational efficiencies.  

Operating Expenses were $2.3 million, up only 5 percent from the same period in 2010 and down over 35% from last quarter. The drop in expense this quarter is largely due to the non-recurrence of non-cash compensation costs reported in First Quarter 2011. The Operating Loss of $1.6 million this quarter is lower by $260 thousand, or 14%, from the same period last year and down $1.6 million, or 50%, from First Quarter 2011.

Other Income for Second Quarter 2011 was $2 million compared to a loss of $1.4 million for the same period last year and income of $2.4 million last quarter. The improvement over last year is largely attributable to a gain of $2.2 million on our derivative valuation.

Net Profit for Second Quarter 2011 was $442 thousand, up from a net loss of $3.2 million for the same period last year and up from a net loss of $747 thousand from last quarter. The substantial improvement from 2010 is primarily due to lower interest expense as well as higher income from the valuation gain on the Company's derivatives.

The increased revenues and profitability in Second Quarter 2011 helped to reduce the quarterly net negative cash flow to $693 thousand, or $231 thousand per month. With the cash and accounts receivable balances at the end of the quarter, the Company should have sufficient reserves to sustain operations well into 2012, exclusive of the prospective sales of the new CodecSys software.

Rod Tiede, President/CEO of Broadcast International, stated, "We are pleased to show the substantial increase in revenues and profitability from our BI Networks Division. The Company continues to position itself as the leader in providing video solutions for enterprise customers." Tiede continues, "We are also pleased to announce that our CodecSys Division has now placed 30 evaluation units of CodecSys at several of the world's largest telco's, largely through the exposure gained with our key strategic partners. For additional information about the progress of our CodecSys and BI Networks Divisions, I encourage our investors to view a special podcast that will be posted on our website (www.brin.com) on Tuesday, August 16th at 9:00am MDT."

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. The technology provides a unique solution for cloud-based initiatives.

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