Samsung, RealD pact for ZScreen passive glasses 3D TVs falls apart

Nov 3rd 2011
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Samsung, RealD pact for ZScreen passive glasses 3D TVs falls apart

Back at CES, Samsung’s business display unit and RealD announced a deal to construct passive glasses compatible 3D TVs with sharper resolution than FPR, because the active shutters are built into the screen itself. Seems, that promise won’t be fulfilled. In its Q2 earnings report released yesterday, RealD confirmed that the agreement fell through since Samsung’s “initiative to fabricate panels… isn’t being pursued.” RealD did say it’s decided to explore “other potential partners,” for the ZScreen technology however it has yet to give any specifics. Equally ambiguous are the criteria that caused the Samsung schism, though RealD CEO Michael Lewis told reporters that the Korean manufacturer simply “had a up to date management change, reviewed all their projects and decided to not go forward.” He added, however, that his company remains “bullish at the technology.” Samsung, for its part, has yet to touch upon the tale.

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RealD Inc. Reports Financial Results for Second Quarter of Fiscal 2012

LA, Nov 02, 2011 (BUSINESS WIRE) — RealD Inc. RLD -13.85% , a number one global licensor of 3D technologies, today announced financial results for its second quarter of fiscal 2012 ended September 23, 2011.

Second Quarter Financial Highlights

Revenue

– Revenue was $88.0 million, a rise of 35% from $65.3 million within the second quarter of fiscal 2011.

– Net license revenue was $52.0 million, a rise of 119% from $23.8 million within the second quarter of fiscal 2011.

– Excluding the impact of $11.6 million in exhibitor stock option expense inside the prior year quarter (a contra revenue item), licensing revenue increased 47% year-over-year. Since all exhibitor stock options vested in fiscal 2011, RealD doesn’t expect to incur exhibitor stock option expense through the current fiscal year or in years to come.

– Product and other revenue was $36.0 million, a decrease of 13% from $41.6 million within the second quarter of fiscal 2011. The decrease is partially because of progressively more international consumers returning to the cinema with RealD eyewear purchased at a prior RealD showing.

– License revenue increased to 59% of gross revenue in the course of the quarter from 46% of gross revenue within the second quarter of fiscal 2011, whereas product revenue decreased to 41% of gross revenue in the course of the quarter from 54% of gross revenue within the second quarter of fiscal 2011.

GAAP Results — Profitability Measures and Balance Sheet

– GAAP net income as a result of common stockholders was $18.9 million, or $0.33 per diluted share. Within the second quarter of fiscal 2011, the corporate recorded a GAAP net loss caused by common stockholders of $5.1 million, or $0.12 per share.

– Gross margin increased to 48% from 21% within the second quarter of fiscal 2011.

– The corporate’s balance sheet at September 23, 2011 included total cash and cash equivalents of $32.5 million and total debt of $25.0 million. The Company had $25 million available on its line of credit as of September 23, 2011.

Non-GAAPResults — Profitability Measures

– Adjusted EBITDA was $44.4 million, a rise of 169% from $16.5 million within the second quarter of fiscal 2011.

– Adjusted EBITDA increased to 50% of net revenue from 25% of net revenue within the second quarter of fiscal 2011.

– Adjusted EBITDA is defined in the component to this press release entitled “Use of Non-GAAP Financial Measures,” which incorporates a reconciliation to its most comparable GAAP measure, net income.

“a robust 3D film slate and our growing base of 3D cinema systems worldwide enabled RealD to deliver significant year-over-year growth in license revenue, a key driver of our growth in net income and changed EBITDA in the course of the quarter,” said Michael V. Lewis, Chairman and Chief Executive Officer of RealD.

Key Metrics and International Revenue Statistics

– International markets generated 56% of gross license revenue within the quarter when compared with 52% of gross license revenue within the second quarter of fiscal 2011.

– As of September 23, 2011, the corporate had deployed approximately 18,700 RealD-enabled screens, a rise of 101% from approximately 9,300 screens as of September 24, 2010, and a rise of one,200 screens, or 7%, from approximately 17,500 screens as of June 24, 2011.

– As of September 23, 2011, the corporate had approximately 11,100 domestic screens at approximately 2,500 domestic theater locations and approximately 7,600 international screens at approximately 2,400 international theater locations.

Recent Business Highlights

– RealD entered into agreements with two Chinese cinema circuits: SHIMAO Cinema and Beijing SAGA Luxury Cinema. Each exhibitor committed to equip no less than 100 auditoriums with RealD technology.

– RealD today is announcing revised expectations for its license agreement with Samsung Electronics LCD Business. In May 2011, RealD and Samsung announced that panels featuring RealD 3D display technology were expected to be made available to consumer electronics manufacturers by early 2012. RealD has recently learned that Samsung’s initiative to fabricate panels under the RealD license agreement isn’t being pursued right now. Hence, RealD is now pursuing other potential partners for its 3D display technology among consumer electronics panel manufacturers.

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