Blackbird PLC (LON:BIRD), a cloud video developer, has been grabbing investors’ attention of late. In the last month, shares in this small cap stock have increased by around 60%.
The recent announcement that Blackbird will be used for another 18 US TV stations for TownNews, the digital news production company is no coincidence of course. It is the fifth contract expansion of Blackbird by TownNews since the partnership began in 2018 and means that 69 US TV stations now use Blackbird to access, edit and publish news content to social and web platforms. The stock is now around 36p per share.
Blackbird: the facts
Blackbird operates in the highly competitive, fast-growing SaaS and cloud video market. According to ResearchandMarkets.com, the market size is projected to reach US$ 3.04 billion by 2027. And while the company might have to compete with the likes of Adobe and Vimeo, potentially, Blackbird has a strong USP – its patented technology.
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The company currently holds nine patents with a further five pending. These include patents for frame accurate navigation, playback, viewing and editing in the cloud. As Allenby Capital, which acts as nomad and broker to the firm, stated in a research note: “At its heart, Blackbird is an intellectual property company.”
The Blackbird software removes the need for costly, high end workstations and can be used from almost anywhere on almost any device. It allows full visibility on multi-location digital content and improves time to market for live content such as video clips and highlights for social media distribution. It also has multiple applications which are used by rights holders, broadcasters, sports and news video specialists, esports, live events and post-production houses.
Increased revenues despite Covid challenges
Despite the pandemic where live sport and post-production were on pause for several months, the firm did well throughout last year. This was helped by the firm’s ‘owner equipment strategy’ of partnering with key major infrastructure players to access partners’ sales channels as a route to market. This resulted in new distribution partnerships with Tata Communications and EditShare (amongst others). OEM sales now account for 41% of the revenue mix, while the other 59% comes from infrastructure. Blackbird also brought on to their roster, US and EU names such Arsenal FC, Sky News Arabia and the National Hockey League.
The firm increased revenue year-on-year by 45% to £1,567,109 for the twelve months ending 31 December 2020. North American revenues contributed the lion’s share at £968,251 – double that of 2019. Net loss for the year was £1,880,604 although this compares favourably to a net loss of £2,128,639 in 2019.
2021 bodes well for Blackbird
So far in 2021, the firm has signed a deal with EVS, a live video technology group, extended their contract with Riot Games, established new deals in the e-learning sector with Typsy and Bo Clips and they have also announced a partnership with LiveU which offers end-to-end solutions in live sport and news.
At the end of April news circulated that Blackbird CEO, Ian McDonough had increased his shareholding: he and his wife now have a joint total beneficial interest of approximately 2.49%, while Blackbird’s COO and CFO, Stephen White also increased his shareholding to 0.11%.
There is nothing like having skin in the game, but with Premier Miton Group, Schroders and Canaccord Genuity Group counting among the list of significant shareholders, what is perhaps even better for Blackbird, is to see that institutional investors are taking an interest too.