Vista eyes bigger picture
Cinema software company looks to tap emerging markets after solid debut on NZX
Emerging markets are a major focus for newly listed software developer Vista Group, with chief executive Murray Holdaway saying “huge opportunities” exist for the company in fast-growing economies including China, Brazil and Vietnam.
The Auckland-based company, whose technology is used to manage cinema operations in 63 countries, pulled off a solid stock exchange debut yesterday. Its shares closed at $2.55 last night, an 8.5 per cent premium to the $2.35 issue price,after the company’s NZX and ASX listing that raised $92 million, including $40 million of new capital that will be used to bankroll acquisitions and growth plans.
Vista claims to hold a 37 per cent share of the world’s large-cinema market — operators with more than 20 screens — and Holdaway said emerging markets were a key element of the firm’s strategy as it pushed to boost that share to more than 50 per cent.
He said the company, which has an office in Shanghai, had its technology installed in only about 50 Chinese cinemas at present.
But China’s second-largest cinema operator, Dadi, recently began testing the Kiwi technology across 27 cinemas in Beijing and the northeastern Shandong province.
“In a few weeks’ time they’ll make a decision over whether they will put us into another couple of hundred cinemas,” Holdaway said.
The Chinese cinema market became the first outside the US to generate more than US$3 billion in annual ticket sales last year, according to the Motion Picture Association of America.
Holdaway said Vista’s technology was being certified by the Brazilian Government and a number of additional emerging markets also had potential.
“A good example is Vietnam, where they’ve got probably the same number of cinema screens as New Zealand but the population is [more than] 80 million so the opportunity for new cinemas and new screens — which is essentially what drives our traditional business — is just huge.”
The company had just secured its first customer in Indonesia, Holdaway added.
Vista’s group revenue in the year to December 2013 was $38.7 million and is forecast to rise to $49.9 million in 2014 and $61.5 million in 2015. Net profit of $8.1 million is forecast for the 2015 financial year.
Existing shareholders, who include Holdaway and executive director Brian Cadzow, have retained a 47 per cent stake in the company after the IPO. The $2.35 issue price valued the firm at $188 million.