ADB Group Reports Record Financial Results For 2008

Tuesday, February 24th, 2009
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GENEVA — ADB Holdings SA (SIX: ADBN) reported today ADB Group’s unaudited consolidated financial results for the full year 2008.

Digital TV Equipment segment (Advanced Digital Broadcast – ADB)

The Digital TV Equipment business segment yielded US$ 353.0 million of revenue in 2008, growing 25.8% over 2007. It delivered segment Earnings Before Interest and Tax of US$ 22.4 million, or 6.3% of revenue, growing 155% over 2007.

High-definition TV (HDTV) product sales grew significantly, accounting for 72% of the segment’s revenue, up from 57% in 2007. Personal Video Recorders (both high and standard definition) represented 39% of the Digital TV Equipment revenue, compared to 26% in 2007. The key contributing factors to this development are high demand from pay-TV operators, generated by growing public awareness and acceptance, as well as by increasing simplicity and reliability of such devices’ operation. This in turn is a clear result of more efficient software solutions which the Group provides.

The year was strong for IPTV business, which constituted 27% of the Group revenue and grew 36% over 2007. The main drivers were the expansion of the customer base as well as the demand by recurring customers. Terrestrial segment represented 18% of Group revenue, compared to 12% in 2007. Terrestrial share of revenue grew significantly due to increased product purchases in Northern Europe and solid demand in Italy. Cable maintained its position as the largest business of the Group, representing 39% of Group overall revenue, driven by demand from both existing and new customers. Satellite segment sales represented 13% of the Group revenue, all generated by the Group’s high-end products.

The efforts of Group’s technology departments received three significant recognitions during the year:

  • In March the IPTV World Forum awarded ADB Group with “Best IPTV Customer Premise Equipment Technology”, for the second year in a row;
  • In May the Group obtained CableLabs’ tru2way™ (formerly known as OCAP) certification for its new set-back box model (thus far the only one in the world);
  • In September, the International Broadcast Conference recognized ADB Group with “Best Customer Premises Technology Award”.

Building on the achievement of the CableLabs’ certification, ADB Group signed in June a Memorandum of Understanding with the leading US cable operators and major consumer electronics companies for the committed development of tru2way, the new interactive technology platform for the US cable market. In early January 2009, the Group also announced its co-operation with Sony for developing products for the US cable market.

Software and Services segment (Osmosys and Vidiom Systems)

The Software and Services business segment recorded revenue of US$ 18.2 million, out of which US$ 9.0 million were intergroup sales. The segment recorded a Loss Before Interest and Tax of US$ 3.0 million. During the latter part of 2008, the Group re-aligned the Software and Service segment’s US operations to be more in line with its North American strategy. The segment was profitable in the second half of the year. Some of the key achievements for this segment were the first commercial deployment of its Blu-ray software solution, the acquisition of new customers for its MHP middleware as well as for its newest product additions such as its push-VOD system. In addition, the Software and Services segment played a key role in the Group’s win of TFN in Taiwan. The Group regards these successes as an indication that the strategy of product portfolio development matches the market demand.

The Software and Services segment remains a powerful facilitator in building the Group overall business, and plays an important role in the Group overall strategy. The Group intends to continue its investment in this segment to develop a complete product and services offering and targeting its self-sustainability and profitability.

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