July – September 2017
- Deployed license base
- The VAS (value added services) enabled license base grew by 51 thousand licenses to an accumulated base of 6,8 million.
- 1,2 million licenses are sold this year representing a decrease of 44% compared to last year, this is however primarily explained by the large number of licenses sold to Deutsche Telecom in Q3 last year and Megacable in Q1 last year.
- Net sales and other operating income decreased by 4,3 % year-on-year to SEK 51,9 million (SEK 54,2 million)
- EBITDA in the third quarter 2017 was SEK 5,9 million (SEK -7,7 million)
- Net result in the third quarter 2017 was SEK -7,2 million (SEK -20,7 million)
Events after the reporting date
- Nothing to report
Comments from Jorgen Nilsson, CEO of Zenterio:
Let me start this third quarter report 2017 to repeat Zenterio’s business model to build a Value Added Services (VAS) enabled license base, on which base to thereafter add recurring revenue, in the form of various VAS such as Analytical Services, Advertising Services and User Interface Solutions. Building that base has been costly and initially generates little revenues. It is a long process for operators to change their strategic direction and such critical components as the operating systems in their user terminals. However, this works to Zenterio’s advantage once installed, and each new instalment add to the potential of adding recurring VAS revenue, at a low marginal extra cost. Following the overall business objectives, Zenterio in addition improve the overall commercial model for the operator and increase their direct and indirect revenue.
Now, reflecting back on this quarter, it has been very gratifying to have fulfilled all commitments, with high quality support, for the launch of the second and very comprehensive Pay TV solution together with Deutsche Telecom Germany. Having delivered flawlessly, Zenterio is now in the forefront of solutions for Pay TV Operators globally. This launch includes very relevant OTT propositions that secure a strong competitive advantage and demonstrate the direction of future solutions in terms of features and functionality for the TV German market. A market that has seen a great growth trend. Having achieved this operational milestone event for the company the financial performance follow the second quarter’s indications of growth in profitability and we are confident we are on right track now moving forward.
Net sales amounted to SEK 51,9million, -4,3% lower compared to Q3 2016, as we decided to put all major resources to finalise the key deliveries to DT in the first half of 2017, as our highest priority to build trust for new relevant business moving forward. On the EBTDA level, the improvement that started in Q2 continued and resulted in an EBITDA of SEK 5,9 million, improved from SEK -7,7 million in Q3 2016. Based on the reported numbers, I am happy to report that Zenterio delivered a positive EBITDA year to date of SEK 7,8 million, compared with SEK -4,0 YTD 2016.
Zenterio has now accumulated an installed base of customers that start to have Zenterio’s solutions finally in service, hence we can start to grow and introduce Value Added Services to further improve margins.
At the IBC trade show in Amsterdam, we announced our broaden product portfolio and our focus for migration solutions and relevant propositions for improved customer experiences that generate new behavior insights and new revenue concepts for Pay TV operators. Live demos provided evidence of how successful implementations can look like, and was very well received by all visitors. We drew attention from some of the largest global operators that have legacy solutions to be modernized. The industry is looking for solutions that provide an architecture that bring new customer experience forward with less complexity from today’s strong dependency between the backend and the client side. At Zenterio, we believe we can provide a clear path to reduce dependency and increase flexibility. Zenterio will as of now include Android solutions in the product portfolio with the intention to complement our additional VAS service options.
In addition, we recently strengthened relationships with a few key partners that we believe will strongly promote our solutions and support our go to market presence. I feel obliged to mention our fantastic customer base and how we jointly discuss and develop strategic direction together that strengthen our value add in the industry. This makes us better to set expectations, make joint priorities and to have the right competence and flexibility in place.
We look forward to finish 2017 with confidence and I am pleased to announce that we have established a very senior and experience leadership team. We continue our strong focus on growth by delivering what we commit to, bringing profitability, cash management and the working capital discipline that we have now started to see the effects of.
For more information, please contact:
Jorgen Nilsson, CEO
Phone: +46 13 36 39 50
Steven Moodie, CFO
Phone: +46 13 36 39 50
Zenterio provides an independent OS for interactive TV aimed at creating an industry standard. Zenterio also offers an intuitive multiscreen UI, a powerful Data Analytics solution, Consulting Services and additional Value Added Services to TV operators. Zenterio partners with global system integrators, set-top box suppliers, CA/DRM providers, chip-set manufacturers and services providers. Zenterio has offices in Stockholm, Linköping and Atlanta and is owned by private investors and private equity firm Scope. The Chairman of the Board is former Nokia CEO Mr. Olli-Pekka Kallasvuo and the CEO is former Ericsson executive Mr. Jorgen Nilsson. For more information please visit zenterioab.wpengine.com.