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Miranda Acquisition to Be Determined by June

MONTREAL, QC, CANADA: Whether or not Miranda is sold will be decided by June. The company said today in its first-quarter results announcement that the related strategic review, announced March 21, “is expected to last approximately three months from the original announcement.”

“I think the process is unfolding more or less the way we expected,” said Miranda’s president and CEO, Strath Goodship on a conference call with analysts. “There are a number of phases, but it wouldn’t be appropriate to tell you where we are there.”

Goodship said Miranda was about “halfway” through the process, and that nothing has occurred that the board has deemed “reportable.” If no sale is consummated, Goodship said Miranda has scored some strategic alliances.

“What’s happened as a result of discussions is, we’ve gotten closer to a number of potential partners. We don’t exclude the possibility of working closely with these in the future,” he said.

The Miranda directors announced their intention to entertain acquisition offers in March following an investor revolt that was quelled by a shareholder vote during the National Association of Broadcasters convention last month. The vote confirmed industry turn-around veteran Tim Thorsteinson to the board. Thorsteinson was in charge of Grass Valley and Leitch before those companies were sold, and of Harris Broadcast, which is now for sale.

Miranda reported revenues of C$42.2 million for the first quarter of 2012, up 7 percent from a year ago. Growth was driven outside of Canada, up 64 percent in the United Kingdom and 8 percent in the United States, which accounted for one-third of Miranda’s sales. Sales in Canada fell 40 percent.

Gross profit was 61 percent of sales, versus 60 percent last year. Net profit was C$928,000 compared to C$2.3 million a year ago. Adjusted net profit was C$3.2 million versus C$1.9 million for 1Q11. Earnings before income tax, depreciation and amortization were C$3.9 million versus C$5.5 million. Operating cash flow was C$5.6 million, up from C$4.9 million last year.

Goodship said the potential sale has had no affect on the company’s ability to close deals.

“I think overall there’s initial apprehension, but I think we’ve overcome that,” he said.

A “key sale” to provide technology for NBC Olympics, among others, was announced at NAB. Revenue realized from that event is expected to land mostly in the second quarter.

First-quarter revenue growth—smaller than expected and beneath Miranda’s target of 11 percent—was attributed more to the state of the market than the acquisition announcement. Goodship said Miranda would continue to shoot for 11 percent growth.

“I don’t think you can take one quarter and assume long-term trends,” he said.

The company ended the first quarter with no debt and C$36.6 million in cash, cash equivalents and temporary investments. Shares (TSE: MT) opened today at C$11, up 21 percent year-to-date.

~ Deborah D. McAdams

Also see...
April 19, 2012:
Miranda Board Resists Revolt”
The board of Miranda Technologies this week averted a hostile takeover in a shareholder vote that confirmed the sitting members and added Tim Thorsteinson as a director. 

March 21, 2012:“Miranda Sends Out Sale Balloon”
Shares of Miranda Technologies shot up this morning on the news of a potential sale and a board shake-up. 

January 12, 2012:“Miranda Targeted for Takeover”
The investment firm aiming to take control of Miranda Technologies has put forth its nominees for the board of directors, including former Harris, Leitch and Grass Valley executive, Tim Thorsteinson.