ADB Group delivers mid-period update on its 2008 second half business

Thursday, October 30th, 2008
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“¢ Management reiterates confidently its guidance for 2008
“¢ New customer acquisitions during third quarter 2008
“¢ Full order backlog confirmed for the rest of the year
“¢ Positive developments in the Software and Services segment

GENEVA — Advanced Digital Broadcast Holdings S.A. (SIX: ADBN) reported today an update on the development of its business.

The Group’s business developed favourably during the third quarter of the year 2008. The supply chain has been performing effectively and according to plan. The operator business in satellite, cable and IPTV segments were this quarter’s main drivers. Year-to-date, high-definition TV product sales have grown to approximately two thirds, and PVR sales to more than one third of the overall Digital TV Equipment segment revenue.

The order book for the year is full, driven mostly by a continued strong operator demand and a favourable product mix.

In the area of new business development, the Group established new customer relationships and recorded other significant positive developments during the third quarter of 2008:

  • Strong Group, a set-top box distributor which covers most European countries, is starting to distribute the Group IPTV products to tier two and three operators in Europe.
  • New line of digital terrestrial set-top boxes targeted for Italian markets under the brand “i-Can” are being rolled out.
  • RiksTV, a leading DTT operator in the Norwegian market, licensed Osmosys’ Push Video-On-Demand solution for its new high definition TV service. Simultaneously, Grundig will start distributing ADB’s latest HD video recorders to enable the launch of this first Norwegian push-VOD operation.
  • Vestel, one of the world’s largest consumer electronics ODM of digital TV products, will deploy Osmosys’ Java-based middleware in the new type of its digital TV receivers.
  • Osmosys and HitachiSoft announced first commercial deployment of the integrated Blu-ray software solution. The solution provided by Osmosys consists of the Blu-ray disc Java engine which Osmosys licensed to Hitachi.

In September, ADB’s high-definition hybrid IPTV digital video recorder ADB-5810TWX won “Best Customer Premises Technology” Product of the Year award from Cable & Satellite International. It is the fifth time the Group has won this prestigious award and the third time in this particular category. This is also the second major award during this year, the first one being the IPTV World Series Award at the IPTV World Forum in March.

The Group maintained positive net cash position at the end of September. During the third quarter, the Group launched a share buyback programme for up to 330’000 of its shares through Bank Vontobel. As of 21 October, the company had bought cumulatively 102’186 shares under the new buyback programme, and thus held in its treasury a total of 389’775 shares, or 6.3%, of its share capital. The buyback programme is continuing.

During the third quarter, considering positive developments in the US cable and IPTV markets, the Group continued to realign its resources to further strengthen its US position. In this context, the Group reorganized its US subsidiary, Vidiom Systems, Inc.: certain engineering resources were transferred to the Group’s US cable unit, while the remaining core continues to focus on the Group’s middleware and system integration. The non-core professional services business has been disposed of. This reorganization is in line with the Group’s staged approach to the US cable market, and is also expected to improve the Software and Service segment profitability.

Andrew Rybicki, Chairman and CEO, commented: “The Group’s good performance in the third quarter clearly confirms effectiveness of our strategies and organizational structure introduced in the beginning of the year. I am satisfied with our overall performance, and confident that our strategies will successfully carry us forward. The customer demand has continued to be strong. As usual, we have continued working closely with our customers to assess the market, and business opportunities going forward. Consequently, initial visibility of 2009 is good, and the delivery pipeline has started taking shape.”

Overall, the management is satisfied with the Group’s results, and confidently confirms the upwards revised guidance given on 12 August 2008 half-year earnings release.

The management of ADB Group will hold a conference call today to comment this business update at 15:00 CET.

To connect to the conference call, participants should dial the following number: +41 (0) 44 580 65 22
To ask a question, participants will be required to dial: 01.