SENSIO Corporate Update
MONTREAL, QUEBEC--(Marketwired - Dec 10, 2013) - SENSIO
Technologies Inc. ("SENSIO" or "the Company") (TSX-VENTURE:SIO)
(OTC:SNIOF), is providing today a general corporate update on its
business activities. "As we were in the process of finalizing the
second tranche of our private placement, it was decided that,
exceptionally, no investor phone conference would be held following
the publication of our FYE 2014 first quarter results," said
Nicholas Routhier, President and CEO of SENSIO. "With the closing
behind us, we think that the timing is ideal to summarize for our
shareholders up to date information on the state of our
business."
FINANCING AND COST REDUCTION PROGRAM
On November 13, SENSIO closed a second and final tranche in the
amount of $630,000 for its most recent private placement which
totaled $2,670,000. The use of proceeds for this placement is for
general working capital purposes and for business development,
namely for the expansion of 3DGO! to more devices, porting to new
platforms and further content acquisition. In parallel to this new
financing, the Company accelerated its cost reduction program which
it had already begun in the previous fiscal year. The Company
expects these cuts will begin to have a noticeable impact starting
in the third quarter of the current fiscal year.
"In fiscal 2013, SENSIO had to make considerable investments in
order to develop 3DGO!, acquire content distribution rights from
Hollywood studios and launch the service in the U.S.," said Mr.
Routhier. "We believe these investments were necessary in order to
position SENSIO as a leader in 3D image processing technologies,
add value to our existing products and sign with more CE
manufacturers. Now that 3DGO! was launched, we are in an
optimization mode in order to reduce our expenses with a view to
achieve a cash flow positive situation. Although the last round of
equity financing was more dilutive than originally anticipated, we
are pleased with the response from investors who have seen 3DGO! in
action and decided to participate in this placement. We are
committed to the long term success of the Company and we will
continue to manage our cash resources in a responsible way in order
to achieve our commercial goals for the benefit of our
shareholders."
PATENT LICENCING UPDATE
Since the end of the first quarter, SENSIO has been granted a
new patent in Europe pertaining to the S2D Switch licensing
program. This new patent is in addition to those already granted in
the U.S., India and, recently, Japan. A final S2D Switch related
patent is currently pending in China. The recent grants of the
Japanese and European patents further increase the revenue
potential of the S2D Switch program as there are significant sales
of 3DTVs in these territories which have not been fully addressed
by the existing deals with CE manufacturers. The exact potential
remains to be determined and will be dependent on the demonstration
of the actual use of the patented method in products manufactured
or sold in these territories.
"Early results of the collaboration with WiLan are above our
expectations," explained Nicholas Routhier. "Patent licensing deals
typically take between eighteen to twenty-four months to negotiate
with CE manufacturers yet WiLan generated its first revenues only
nine months after signing our licensing agreement. For the
twenty-four month period ending August 31st, 2013, our patent
licensing activities have generated more than $1,9M in cash inflow
for the Company which is not negligible. It is not unreasonable to
expect that revenues from the patent licensing activities will
eventually cover our existing operating costs based on our reduced
expenses, commercial terms from the Panasonic deal and volumes of
3DTVs sold in regions where SENSIO has S2D Switch patents. We are
optimistic about the prospects for this business line."
3DGO! UPDATE
Since the beginning of the year, SENSIO has experienced a steady
growth in the number of users and average volume of daily rentals
on a month to month basis. As at December 1st 2013, there were
8,019 registered users and 2,693 active users, a growth of 160% and
201% respectively since the end of the first quarter. These users
all came from Vizio 3DTV owners as 3DGO! is currently only
available on Vizio devices. With the upcoming Holidays and new
titles to be released, the Company expects that the current growth
trend will continue for the third quarter of the fiscal year. As
for Panasonic, porting work of the 3DGO! store has recently begun
with target availability before the end of the current fiscal year.
The porting work, which has been deliberately postponed a few
months to coincide with the recent closing of the private
placement, is progressing according to expectations.
"SENSIO is fundamentally a 3D technology company and 3DGO! is by
far our best promotional tool to increase our visibility as well as
the market penetration of our technologies", said Mr. Routhier.
"The growth we are experiencing with 3DGO! in terms of membership,
rentals and repeat business shows that a well packaged 3D home
experience can be successful and appealing to consumers. In our
view, our recent agreement with Panasonic demonstrates that CE
manufacturers are beginning to recognize the added value 3DGO!
brings to 3DTVs. While the growth of 3DGO! will be limited during
this fiscal year by its restricted availability to a limited number
of devices, we have planned numerous direct marketing activities to
get the maximum out of the current install base. Our goal for the
rest of the year is to add new CE manufacturers and to port the
3DGO! store as quickly as possible to their devices in order to
increase our potential user base for the future. We are very
excited with the growth potential of 3DGO! and by the early results
after only six months of operations."
TECHNOLOGY LICENSING UPDATE
Revenues from the technology licensing activities have increased
since the beginning of the year, namely due to the first revenues
generated from the deal with Hisense for 3DTVs sold in China. The
revenues in the Chinese market are however expected to remain
minimal until SENSIO Hi-Fi 3D content becomes available in the
territory. SENSIO is currently evaluating and working on various
alternatives to make such content available through Chinese
partners. There are no set expectations for when the content will
be accessible in China. Globally, technology licensing revenues are
expected to grow in the coming quarters with the growth of 3DTV
sales in the consumer market and the targeted addition of new CE
manufacturers.
Since the 3DGO! service is only available in SENSIO Hi-Fi 3D,
technology licensing revenues can be expected from all 3DGO! deals
with CE manufacturers unless otherwise specifically indicated. For
legacy devices (i.e. 3DTVs already sold to consumers), most
technology licensing deals will be based on a recoupment from the
revenue share portion which would normally be paid to CE
manufacturers for the use of their connected 3DTV platform. In
other words, SENSIO will be deducting a technology licensing fee
from the revenue share normally payable to CE manufacturers on each
rental by end users. The Panasonic agreement is based on such
licensing terms. The standard licensing model based on a per unit
royalty remains active and is our preferred model, namely for
future 3DTV sales in the market.
"Technology licensing remains our main focus and, with the help
of 3DGO!, we have developed new creative ways of offering and
monetizing our technologies," said Nicholas Routhier. "We have
developed several pricing strategies and packages which offer
equivalent mid-term revenue potential based on our analysis and
available market data. With these options, we are able to offer our
CE customers various options with the flexibility to fit their
particular needs. This is why today, the SENSIO Hi-Fi 3D format
remains the only proprietary frame compatible format in use in the
market and why we are expecting that it will continue to gain
market shares and increase its penetration within the 3DTV segment
and soon with glasses-free 3D tablets."
MORE TO COME
At the upcoming CES and annual shareholder's meeting, SENSIO
will be providing additional details on its strategy to grow its
revenues and take advantage of new trends such as 4K/Ultra HD TV
sets and glasses-free 3D tablets. "While some people have been
pessimistic on 3D, we have many reasons to be enthusiastic about
the potential of 3D in the home which in our view is evidenced by
the adoption and growth of our 3DGO! store", said Nicholas
Routhier. "We are still in the very early days of 3D in the home
and we are confident that a well-packaged 3D offering which is
simple, accessible, affordable and which delivers a high-quality
experience is appealing to consumers. The advent of 4K and
glasses-free technologies represent a new step forward for 3D in
the consumer space and we expect it to regain a lot of visibility
in the coming year. We are looking forward to sharing our vision
with our shareholders in the New Year".
For further information on SENSIO and its technologies, please
visit www.sensio.tv
About SENSIO Technologies Inc. (SENSIO):
SENSIO Technologies Inc. (www.sensio.tv) has been leading the
floor in bringing 3D video to the consumer since 1999. Its vision,
expertise and state-of-the-art solutions, based on diversified
stereoscopic image-processing technologies, have been trusted by
some of the biggest names in the media and entertainment industries
to power numerous industry firsts, initiate new business models and
generate immediate revenue with a distinctive 3D offering.
SENSIO enables its clients to deliver the best possible 3D
experience for the end-user through a broad portfolio of products,
including its flagship, award-winning technology, SENSIO® Hi-Fi 3D.
Through SENSIO solutions, consumers can access - with effortless
interaction and complete peace of mind - 3D content of superior
quality to common frame-compatible formats distributed over
existing infrastructure (cable, satellite or over IP) and displayed
using any existing digital equipment (cinema, home cinema, TV, game
consoles or PC). SENSIO is listed on the Toronto TSX Venture
Exchange.
SENSIO® is a registered trademark of SENSIO Technologies
Inc.
Caution Concerning Forward-Looking Statements
Certain statements made in this press release that are not
historical facts are forward-looking statements and are subject to
important risks, uncertainties and assumptions, both general and
specific, which give rise to the possibility that actual results or
events could differ materially from our expectations expressed in
or implied by such forward-looking statements... As a result, we
cannot guarantee that any forward-looking statement will
materialize and readers are cautioned not to place undue reliance
on these forward looking statements. For more exhaustive
information on these risks and uncertainties, the reader should
refer to the risk factors described in the management's discussion
and analysis of SENSIO for the quarter ended May 31, 2013. The
forward-looking statements contained in this press release
represent our expectations as of the date hereof. We disclaim any
intention and assume no obligation to update or revise any
forward-looking statements. Forward-looking statements are
presented for the purpose of providing information about
management's current expectations and plans and allowing investors
and others to obtain a better understanding of our anticipated
operating environment. Readers are cautioned that such information
may not be appropriate for other purposes.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Facebook: http://www.facebook.com/SENSIO3D
Twitter: http://twitter.com/SENSIO3D
LinkedIn: http://www.linkedin.com/company/337733?trk=tyah
YouTube: http://www.youtube.com/sensio3dtech
SENSIOEric ChoquetteChief Financial Officer+1
514-846-2022eric.choquette@sensio.tv
Sensio Technologies Inc. (TSXV:SIO)
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