- Currently working with auditors on preparing 10-K, which Fred anticipates will be filed in late November.
- Wanted to reiterate that the revenue and EBITDA growth guidance mentioned in this week's press release refers to sequential quarterly, not annual, growth. <-- Clarification, since not everyone reads the comment threads here, and since I have seen this point misinterpreted elsewhere: Fred did not offer any earnings guidance beyond next fiscal year's Q1. Also, if memory serves, the company's fiscal Q1 tends to be its strongest seasonally, and its Q2 tends to be its weakest. So based on that (not on any specific guidance from the company) I would expect a sequential decline in revenue and EBITDA from Q1 to Q2.
- Cash position is growing, and the rate at which it is growing is rising as well.
- No need to raise funds for capex or operations.
- Said there is an internal group dedicated to working on how to grow the Clipstream business, but he has been more focused on PlayMPE. Deferred to CEO on Clipstream.
Notes on Yangaroo Case:
- Expected motion to dismiss would be unlikely to succeed, but filed it under advice of counsel as part of a broader legal strategy.
- Yangaroo has approached Destiny Media Technologies on more than one occasion seeking a merger. Destiny Media rejected these approaches.
- Yangaroo's case is currently in discovery regarding an issue of extraterritoriality (meaning that the Yangaroo patent cannot even be asserted against Destiny). Yangaroo's lawsuit may not survive a close examination of this issue. Although DSNY management believes that Yangaroo's case lacks merit for a number of reasons, to be efficient, Destiny's legal team is focusing on the issue which it believes is easiest to demonstrate.
- If Yangaroo's lawsuit is unsuccessful, as Destiny Media is confident it will be, Destiny plans to pursue recovering its legal costs from Yangaroo.
- Fred Vandenberg reiterated that major record label clients of Destiny Media were aware of the Yangaroo dispute when they signed their contracts with Destiny Media. These companies are of course sensitive to intellectual property issues, due to the nature of their business, and conducted their own legal reviews of the situation before deciding to sign up as DSNY clients.
Quote from Fred Vandenberg's follow-up e-mail today:
I am very happy with what we have been able to accomplish over last year and 1/2 which to go from a company investing in the initial commercial push of Play MPE.
In Q2-Fiscal 2008
EBITDA (negative) ($718)K
Growing revenue in 5 of the 6 quarters since, turning a loss into income and then continuing the growth of that income
To Q4 - Fiscal 2009 - Revenue $860K to $875K - EBITDA $275K to $290K
That's more than a $1,000,000 improvement in EBITDA in 18 months and - in my opinion - that change comes at the most critical time in any business venture, and we have changed the entire nature of the business.
During that time we signed Warner, expanded to Europe and Australia, extended with UMG in the US and signed UMG in the UK (UMG International), amongst many other things.
We have also done quite a number of things behind the scenes and I think we're more efficient, provide greater value to our clients, and I am more and more optimistic that these behind the scenes activities will result in continued growth in revenue and profit and customer satisfaction well into the foreseeable future.