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Pebble Beach primed as live broadcasting adapts to new normals

Pebble Beach's software solves the complexities that surround live broadcasting.

Pebble Beach Systems -
The group won a £600,000 contract to show premier league games for Amazon

Pebble Beach Systems Group PLC (LON:PEB) has come a long way since it changed its name from Vislink three years ago.

In fact, Pebble Beach was originally acquired by Vislink back in 2014 but it is the only part of the original business that remains.

“There has been a lot of hard work over the past two years,” says chief executive Peter Mayhead.

He took over in 2018, shortly after the separation from the hardware part of Vislink, having originally joining the business five years earlier.

Pebble Beach provides software that enables broadcasters to bring together all the contextual elements that make up a live programme such as graphics, subtitles, feeds, video and audio.

Mayhead uses the example of conducting an orchestra to describe what the software does.

“It seamlessly brings together the many different pieces of equipment that have to come in and out of a programme at various points of time,” he says.

Pebble Beach works in microseconds, he adds, to ensure reliability so there are no black screens, lip-sync issues, timeouts and so on.
These are not only important for viewers but also the advertisers and compliance – some broadcasts have to have sub-titles, for instance.

The software can be customised and is scalable, so one operator can handle up to 100 channels with the use of exception monitors to flag and warn of any issues.

In short, Mayhead says the software solves the complexities that surround live broadcasting.

The fact that major customers include the BBC, Al-Jazeera and major Brazilian broadcaster Globo is a testament to its capabilities, he adds.

In December, the group picked up an order worth more than £600,000 from sports content group IMG to enable Amazon Prime to show 20 premiership football matches during December. 

The solution included Pebble Beach Systems' UHD-capable playout servers and control software for automated ad-insertion. 

Having such big customers provides reassurance in challenging times, though Mayhead says the impact from the coronavirus pandemic has been mixed.

On the plus side, there has been an increase in viewers for what he describes as linear broadcasting – terrestrial programmes such as the BBC – but offsetting that has been a decline in subscriptions, especially in the sports market.

Advertising, too, has been affected as companies pull in their horns, but overall, for Pebble Beach, the effect so far has been relatively flat.

Structural change on way

Broadcasting is going through a structural change as well, says Mayhead with new entrants such as Amazon and Netflix driving a switch from expensive proprietary kit to generic IP-based systems.

It is a fundamental shift to the way the business works, he says, with big changes to the industry on the way over the next five years.

That is likely to throw up opportunities and Mayhead believes Pebble Beach is now well-placed to meet them.

Results have also started to reflect the progress with revenues in the year to December rising by 23% to £11.2mln and the company posting a profit of £1.3mln (£472,000 loss).

Net debt of £8.4mln remains a legacy from the Vislink era, though a £9.5mln facility was recently extended until November 2021.

Last year, the business also generated £2mln in cash.

Mayhead believes that after two years of work to get the business re-focused, strong and able to move forward, it has now demonstrated it has a healthy future.

“We are experiencing good growth, healthy margins, are generating cash and investing in new technology.”

This hasn’t gone unnoticed. Pebble Beach shares have almost tripled since the start of 2018, but with broadcasting habits changing, possibly permanently, this is one to watch.

At 11.1p, the business is valued at £12.5mln.
 

Quick facts: Pebble Beach Systems

Price: 11.25 GBX

AIM:PEB
Market: AIM
Market Cap: £14.02 m
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