Costar Technologies / Arecont H1 2020 Financials Examined

By Isabella Cheng and Joey Walter, Published Sep 16, 2020, 08:34am EDT

Costar's financial results have been hit by the coronavirus with the company telling IPVM they are focused on "turning around" Arecont and plans for 2021.

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Costar made a splash acquiring Arecont in 2018, formerly one of the largest megapixel camera manufacturers, who later struggled and became the integrators' worst choice 3 years in a row prior to the acquisition.

Their CEO spoke to IPVM about making progress integrating Arecont, and their future outlook leading into 2021, including:

  • YOY revenue / income down
  • Costs reduced
  • Arecont integration
  • Organic growth
  • R&D / manufacturing
  • Product delays
  • PPP loan / Covid-19 impact
  • Vertical breakdown
  • Outlook

Revenue **** **% ** **

******'* ************** ** **** *****, during *** ****** ** coronavirus *********, **** **** 28% *** ** $**.* million ***.

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*** *** ****** ** 2020, ******* *** **** 9%.

Solid **

*******, ****** ***********, ** Q1, ******* *** ****** growth **%:

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Significant **** ****

** *** **** ****, the ******* *** **** significant **** **** ** Q2: *********** *** *********** (R&D) ********* **% *** selling, ******* *** ************** expenses ********* **.*% ** Costar **** **** ********** redundancies **** ************.

Arecont ***********

** ****,****** ******** *******'* *********** for $**.** *********** *** *********** ** "show ***** ******* ** 2020".

********* ** ******** *******, *******, **** ****** bought ******* *** ** bankruptcy ** ****, **** of “********** ********” ** 2018 *** **** ******** Costar’s ********* *******.

**** *****-** *** ******* product ********, ****** **** they ***** ** ********** the "************** ** *** organization" *** "** ********** the ******** *** *** how **** ***** **** serve ********* ***** *******".

One ******

******* ** * ******-**** few **** **** *** "*** ******", **** *** **** accelerated **** ******* *********** teams *** ********** ****, product, *** ******* ***** performed **** ***** *********. For *******, ****** **** IPVM "*** ****" **** support ********* *** *** supporting */* ** *** business *****.

****** ********** ******* ********* as * ****** ** finding ************ ********* **** deeper **** **** ***** post-acquisition ************.

**** ** ** *** know *** **** ** shown **** **** ** those **** *** ********** or **** ****** ******* quality, ********* ******* *** been ******* *** ********* criticized ************.

Organic ******

****** **** *&* ** not ********* **** *** focused ** **** **** in ******** ** ***** 2014, **** *** **** acquisitions.. *******, **** *** they *** ********** ******* on *** *** ****** initiative ** "***** ******* from *** ** ****** throughout *** ************".

***** ******** ******** **** late **** *** ***** $*-** ******* ** revenue ************ ************. **** *** shifted ** ******** ** their "*** ****** ********** and ********** ********* ** promote *****-******* *** ******* revenue".

R&D ****** ********

****** *** *** *** the **** ** "**** investments ** *** ************", stated ** * **** in ****. *** ******* projected **** ***** ** able ** **** ***** Arecont *********** ******* "**** financing *** ********* ******** cash **** **** ********** to *** **** *** down *** **** ****, but **** **** *********** in *** ************".

****** **** **** **** had ** **** ******* to ***** **** ** R&D ** ***** ** make ***** **** ******** on *********************************. *&* ** * percentage ** ******* ********* in ** **** (*.*%) compared ** ** **** (8.47%) **** ** ******* declined *******, *** *** company's **** *** **** to ***** **-**% ** this *****.

SoC ******* *** ******* ***********

******* ****** *** **** changing *** **** **** use. ** *** ****** side, *** *** ********, they ******** **** ***** long-term ********** ********* ***** to********. ** *** ***** end**************** ****, ***** *** been ***** ****** *********, they *** ******* ** replacing **** ************************ ** **** ********* on *** ******** ** Q1 ****.

***** *** *** **** plans ** ***** *** company's *****-******* ***** *** platform, *******, **** ** delayed ** **** ** Q2-Q3 ****.

PPP ****

****** *** *** ****+ ******** ********* ****** the ***, **** ****** *** of *** ******* ** ~$3 *******. ******'* ******** ************** *** **** *** primarily **** ** ******** expenses *.*. **** *** payroll, *** ******* *** company ** ****** "****" employees.

** ******** ** *** ~$3 ******* *** *******, Costar's ******* *** **** nearly $* ******* ** Q2 ****.

Sales ************

****** **** ** ******* its ***** ** ** longer ******* *** ************ and ******* ********* *** international ********. ************, ****** has ****** ** *** business ********** ** **********, but **** *** **** at *** ******* **** different *********.

** **** ****, ****** hired***** ****** ***** ******* *******. Mula *** ****** ** a ****** ** ******** companies ********* ********* *** Genetec.

*********

******'* ********** **** **** that ******, ******* ** "transportation, ****** ******** *** other ********** ************" *** a ****** ** ** a ****** ** ****** protection ********. ** *** H1 ********* **********, ****** lists ** * ******* that ********* *** ************ in **** ******** *******, with *** ************* ******** driving ~**% ** *****.

****** *** **** "**********" results ** *** ****** and ********* ********* ********* from *****-**. ******* **** IPVM ****** *****'* ********* vertical *** ** ******** that ****** ****** ****** losses ** *** ** financial *******, ** ******* were **** ** ******* projects **** ******** ***. Retail, *** ** *** primary ********* *** ****** Video, *** *** "**/**" success ********* ** *******. Some *** ******** ********* have **** **** **** and ****** **** ********** shut ****.

****** **** **** **** international ******** ******* ** helping ** ********* **** risk, *******, **** *** retail ******** ** **** and ****** *********** ** the ****** **** *.*. Dubai.

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