EVS REPORTS RECORD SALES IN 2010, 50% EBIT MARGIN THE BOARD PROPOSES A TOTAL DIVIDEND OF EUR 2.64 PER SHARE

FY10 record revenue of EUR 111.2 million, +45.2% vs. FY09 (+30.6% excluding the big events rentals and at constant exchange rate)
FY10 EBIT margin of 50.0% and strong EPS +47.5% growth to EUR 2.94
4Q10: revenue up 31.3%, net result of EUR 8.2 million
Successful studio diversification represents 50% of FY10 and 4Q10 sales
Global order book of EUR 25.2 million (+8.3% excl. the big events rentals) at February 15, 2011
2010 Gross dividend of EUR 2.64 per share (incl. the interim dividend of EUR 1.16)
2011 prepares for stronger 2012 as industry recovers, diversification accelerates, London2012 tracts, while investing in innovation and expansion

Liège (Belgium), February 17, 2011, EVS Broadcast Equipment S.A. (Euronext Brussels: EVS.BR, Bloomberg: EVS BB, Reuters: EVSB.BR) (Pinksheets: EVBEF), the leader in Professional Digital Video applications for live, near-live and studio TV production, today reported its results for the fourth quarter ("4Q10") and 2010 ("FY10").

Key highlights

Pierre L'Hoest, CEO of EVS said: "In an environment where we saw some signs of industry recovery, mainly driven by stronger revenues for broadcasters, mixed with a need to optimize the use of existing equipments, we have been able to realize a strong performance in 2010. The crisis has reinforced the need for clients to optimize the way their workflows are designed. High definition will continue to be a strong driver for the years to come. In 2011, our focus will not change: invest in innovation, to make sure that we are able to answer to lots of different customer needs in studio, and continue to expand our operations to support the development of the company."

Commenting on the results and perspectives, Jacques Galloy, CFO, added: "In this fourth quarter, sales amounted to EUR 26.9 million (+31.3%), leading to a record year in 2010 (+45.2% to EUR 111.2 million), higher than the company guidance. EBIT margin for FY10 was slightly higher than 2009, at 50.0% of sales, in line with our guidance. For 2011, we expect to leverage on the industry recovery, and on the main drivers that remain valid. This will be an odd year, without any major event (which represented more than EUR 10 million of rentals in 2010). We are strongly investing in expansion in new niches and innovation in new solutions, having grown our headcount by 33% over the last year. Of course, this weights on our short term margins, as we do not capitalize R&D, but hopefully paves the way for future better ones, like over 2002-2005 period. Ongoing diversification, London2012 traction and future big sporting events in emerging markets will constitute other drivers for us in the future."

(unaudited)			IFRS - EUR millions, except earnings per share expressed in	(audited)
4Q10	4Q09	4Q10/4Q09	EUR		FY09	FY10/FY09
26.9	20.5		+31.3% Revenue	111.2	76.6	+45.2%
11.8	10.6		+11.6% Operating profit – EBIT	55.5	37.2	+49.1%
43.9%	51.7%		- Operating margin – EBIT %	50.0%	48.7%	-
0.1	1.6		N/A Contribution from XDC affiliate (incl. dilution profit in 2009)	(0.2)	(0.4)	N/A
8.2	9.4		-13.0% Net profit – Group share	38.1	25.4	+49.7%
8.4	7.9		+5.9% Net profit from operations, excl. XDC – Group share (1)	39.7	27.0	+47.0%
0.61	0.69		-12.5% Basic earnings per share	2.82	1.88	+50.2%
0.62	0.58		+6.5% Basic earnings per share from operations, excl. XDC (1)	2.94	1.99	+47.5%

(1) The net profit from operations, excl. XDC, is the net profit (share of the group) excluding non operating items (net of tax) and the XDC contribution. Refer to Annex 5.3: use of non-gaap financial measures.

Revenue

EVS revenue amounted to EUR 111.2 million in FY10, an increase by 45.2% at actual exchange rate (+30.6% at constant exchange rate and excluding the big events rentals in 2010) compared to FY09. In 2010, the studio solutions represented 49.9% of sales. Around 80% of studio sales have been realised with a large number of small to medium deals. Sales in that segment increased by 125.0% to EUR 55.5 million. Revenue in the outside broadcast segment increased by 7.3% to EUR 55.7 million. Revenues in 2010 included EUR 10.2 million of big event rentals (out of which 54% are reported in the studio segment). OpenCube sales grew by 35% in 2010, reaching EUR 1.9 million on 12 months.

4Q10	4Q09	Revenue – EUR millions (1)	FY10	FY09	% FY10 / FY09
26.9	20.5	+31.3% Total reported	111.2	76.6	+45.2%
26.5	20.5	+29.6% Total at constant exchange rate	109.7	76.6	+43.3%
24.6	20.5	+20.1% Total at constant exchange rate and excluding big events rentals	99.7	76.3	+30.6%

(1) Refer to the geographical segmentation in annex 5.4.

In 4Q10, revenue increased by 31.3% to EUR 26.9 million. Sales in the outside broadcast and studio segments increased respectively by 2.1% and 81.7%. Q4 revenue included approximately EUR 2 million of rentals for the Commonwealth games.

EVS sales have evolved in line with the industry over 2010 with a stronger business last spring. The broadcast equipment industry recovers slowly but surely. On one side, advertising and subscription revenue have grown significantly in 2010, and the migration to HD proves to remain a key growth driver for the entire industry. But on the other side, clients remain cautious; some big players are yet planning to restart their capex programs while other key players are investing in new successful business models.

Geographically, sales have evolved as follows:

Europe, Middle-East and Africa ("EMEA"): EUR 61.0 million in FY10 (+27.0% compared to FY09), representing 54.8% of group revenue. The United Kingdom performed very well in 2010, driven by the Sky News HD & Sky Sports HD deals. On the continental European market, the migrations to tapeless workflows and high definition will be strong drivers in the years to come. Sales in 4Q10 increased by 12.8% to EUR 16.4 million.
Americas ("NALA"): EUR 29.1 million (+60.3% at constant exchange rate). The U.S. were strong in 2010, with further expansion in Outside Broadcast, penetration in the stadiums, and lots of smaller deals to extend existing workflows. In Latin America, the broadcast industry is moving fast as well. It is clear that Brazil will be energized by hosting future major sporting events in 2014 and 2016. In 4Q10, revenue increased by 33.3% to EUR 4.1 million.
Asia & Pacific ("APAC"): EUR 21.1 million (+87.2%). The big sporting events that took place in 2010 in that part of the world served as trigger for new investments by a lot of existing and new clients. Deals were spread across the region, with Malaysia being one of the most dynamic markets. In the last quarter of 2010, revenue jumped by 124.2% to EUR 6.3 million, also helped by the Commonwealth games that took place in October in India.

Innovation

EVS launched many new products and solutions on the market over the last two years, paving the way for future business development as evidenced by 2010 record sales. For instance, the new XT2+ server platform enables 3D production in Outside Broadcast environments as well as empowers live productions. The AirEdit solution provides ethical cuts in international TV satellite feeds. The concept of Media Server or Live Content Fragmentation that had been introduced by EVS at the World Cup in 2006 penetrates many sport events and entertainment programs. EVS has launched a new business unit dedicated to Digitization and Archiving solutions and services which managed thousands of past content libraries. XS and XT Nano servers have broadened the server family in order to reach new market segments. EVS unveiled the GX server in June 2010 for fill and key playout. Epsio sport graphics features are expanding into live events. Opencube completes the EVS solutions with MXF packaging and XDCAM formats. Most of all these new products have been developed over the last two years, amongst others by the additional 72% (plus 71 to 170) R&D staff since the beginning of 2009, that EVS has recruited or acquired. "EVS is designed to perform".

Operating results in FY10

Consolidated gross margin was 79.6% for FY10, slightly lower than 81.8% in FY09 due to a less favorable sales mix. Operating expenses increased by 29.2% in FY10, mainly as a result of EVS consistent strategy to increase its competitive advantage and improve its services to customers. This is also the consequence of the first consolidation of OpenCube as from April 1, 2010. Thanks to much higher sales, the operating (EBIT) margin increased to 50.0% of revenue, compared to 48.7% in FY09. At the end of December 2010, EVS employed 366 people (FTE), an increase by 32.6% over the end of 2009. Most recruitments have been made in 2010 on the back of new, strategic and committed business. EVS will continue to hire good broadcast experts in the future.

For FY10, the average US dollar exchange rate against the Euro was 1.3263, having strengthened by 5.1% compared to 1.3941 in FY09. It had a positive impact of EUR 1.4 million (1.3%) on revenue. This was offset by both the natural hedge (both on operating expenses and foreign taxes) and the financial hedge.

Group income taxes were EUR 16.7 million in FY10. Net profit amounted to EUR 38.1 million in FY10, or +49.7% compared to FY09, while net profit from operations, excluding XDC, was EUR 39.7 million in FY10. Basic net profit from operations per share amounted to EUR 2.94 in FY10, compared to EUR 1.99 for FY09.

XDC, the 41.3% EVS affiliate, enjoys a strong momentum and, together with its affiliate FTT, has installed more than 1,000 digital screens in 2010 in Europe. XDC revenue in FY10 jumped to EUR 61.2 million, partly due to the acquisition of FTT that is consolidated since January 1, 2010 and is accretive to the earnings. XDC had a slightly negative contribution to the results of EVS of EUR -0.2 million, compared to a negative net impact of EUR -0.4 million in FY09 (when it included the dilution profit of EUR 1.3 million). XDC recorded a positive EBITDA of EUR 8.7 million, or 14% of revenues. The new XDC group, including FTT, is gearing up and expanding across Europe.

Operating results in 4Q10

Consolidated gross margin was 76.6% for 4Q10 (81.0% in 4Q09). The lower level is mainly due to year-end inventory write-offs and product mix. Operating expenses increased by 39.7% in 4Q10, mainly as a result of the increased number of employees, including the consolidation of OpenCube as from April 1, 2010. As a result of these elements, the operating (EBIT) margin decreased to 43.9% of revenue, compared to 51.7% in 4Q09. XDC contributed a net share of profit of EUR 0.1 million to EVS results. Net profit amounted to EUR 8.2 million in 4Q10, or -13.0% compared to 4Q09, while net profit from operations, excluding XDC, was EUR 8.4 million in 4Q10. Basic net profit per share amounted to EUR 0.61 in 4Q10, compared to EUR 0.69 for 4Q09.

Balance sheet and cash flow statement

Net Equity represents 73% of total liabilities while return on employed capital is around 75% (net result divided by net equity plus interim dividend less net excess cash). The inventories amounted to EUR 12.4 million at the end of December, a strong increase compared to the end of 2009 due to strategic inventories built-up for some key components in order to avoid any possible supply chain shortage, and due to the high number of EVS servers and new solutions spread in the world under demo, rental and leasing agreements. DSO improved at 60 days.

At the end of December, there were 13,625,000 EVS outstanding shares, of which 140,403 were owned by the company. EVS repurchased 97,797 own shares in 2010 on NYSE-Euronext. At December 31, 2010, 298,350 warrants were outstanding with an average strike price of EUR 39.36.

The net cash from operating activities amounted to EUR 36.6 million over 2010. On December 31, 2010, the group balance sheet showed EUR 27.9 million in cash and cash equivalents, and EUR 1.5 million in long-term financial debts (including short term portion of it) while EUR 15.6 million had been paid-out as interim dividend a few weeks before the end of the year.

Dividend 2010

Last but not least, and as it did since the 1998 IPO, the Board has decided to optimize cash return to shareholders through dividend distribution and/or treasury shares repurchase program. The Board shall propose a total gross EUR 2.64 dividend (including the EUR 1.16 interim) to the Ordinary General Meeting of Shareholders to be held next May 26, 2011, implying a final gross dividend of EUR 1.48 to be paid in June 1, 2011. EVS has been IPO'ed in 1998 at EUR 7.4 per share and, including this proposal, shall have distributed a cumulated EUR 15.07 per share to its shareholders.

Outlook 2011

Executing its "Speed to Air" strategy, EVS serves hundreds of TV stations worldwide with its high-end digital video and audio applications, especially in the field of live sports and studio production where the company has developed leadership positions in various niche markets. The worldwide migration from tape-based operations to integrated tapeless workflows is underway and will certainly gain momentum the next decade. This process is accelerated by the transition from standard definition (SD) to high definition (HD) television, because new equipment needs to interoperate with digital solutions, which are increasingly high definition.

Hence, EVS directly benefits from the following long term growth drivers: the increasing number of video distribution channels like IPTV, web TV or catch-up platforms, the transition to tapeless workflows, the replacement market due to HD format conversion, the launch of new products to address live, near-live or delayed studio production needs, the demand for new "speedclipping" tools to fragment the content to multimedia environments, and an increased focus of broadcasters/IPTV and advertisers on large popular sport broadcasts to gain new viewers. 3D technologies appear to speed up the conversion to tapeless HD production facilities. In the medium to long term, EVS targets the studio market which is estimated to be currently USD 2 billion per annum according to the IABM Broadcast Industry survey and includes storage solutions, video servers, editing solutions, services, news etc, of which around 50% has already made the transition to tapeless solutions. This market is expected to grow by 5% per annum in the next decade. EVS succeeded in growing its market share in that market from 1% in 2005 to around 7% in 2010. Therefore, taking into account usual business risks and uncertainties, EVS Board and teams believe that the underlying demand for EVS products should continue to be supported by these structural growth drivers, which will impact the business over a long period of time and will follow usual equipment acquisition wave patterns.

The global winter order book at February 15, 2011 amounts to EUR 25.2 million, which is -15.5% compared to EUR 29.8 million on the same date one year ago, but, on a more comparable basis, which is +8.3% excluding the rentals for the big sporting events. In addition to that global order book of EUR 25.2 million to be invoiced in 2011, EUR 2.7 million should be invoiced in 2012 and beyond (vs. EUR 3.1 million last year).

Studio orders represent 48.0% of the total EUR 25.2 million order book while they represented 46.1% of the total order intake in 2010. EVS gains market shares and significant customers in this promising segment.

After weaker 2009, EVS is back on track and even exceeded its 2008 sales performance. 2011 shall of course lack some EUR 10 million from big sporting events rentals that were booked in 2010 but should be a good preparation for a stronger 2012. Second half should be stronger than first half year. Industry recovers and many projects are being discussed with existing and new customers in order to create new workflows to enhance the TV and Video experience. EVS is recognized for the quality of its service and advices towards its customers and wide users community. EVS shall continue in expanding its training centers, its service offices throughout its markets. EVS shall also continue developing new solutions with key customers, therefore recruiting key staff in its Headquarters but also in its 19 foreign offices. As all those developments are just expensed – not capitalized-, the short term margins could weaken but longer term margins should hopefully be higher. It should be clear that risk factors such as economical uncertainties, banking troubles, balance-sheets constraints for clients or major currencies fluctuations are not easing any forecast. However, both broadcast equipment industry turmoil and ongoing M&A activity may potentially turn into an advantage for EVS given its strong financials, organization flexibility, innovation power and the potential of its wide installed base.

EVS will hold today the following events:

Press conference in French/Dutch in Liège at 09:30 am CET.
Financial analysts & investors meeting in French/Dutch in EVS offices in Liège at 11:00 am CET.
A conference call in English will be held at 3:00 pm CET (Please contact [email protected] to receive the dial-in number and the presentation).
It shall be attended by Pierre L'Hoest, CEO, Jacques Galloy, CFO and Geoffroy d'Oultremont, IRO.

Status of the control by the Statutory Auditors

The statutory Auditors BDO confirmed that its controls which are substantially finished did not reveal significant correction that should be brought to accounting information mentioned in the press release.

Corporate Calendar:

April 9-14, 2011	NAB tradeshow, Las Vegas
Thursday May 12, 2011	1Q11 earnings
Tuesday May 17, 2011	Ordinary General Meeting
Thursday May 26, 2011	Final Dividend Ex-date Coupon 12
Wednesday June 1, 2011	Final Dividend Payment date Coupon
Thursday August 25, 2011	2Q11 earnings
Thursday November 10, 2011	3Q11 earnings

For more information, please contact:

Jacques GALLOY, Director & CFO Geoffroy d'OULTREMONT, Investor Relations & Corporate Communications Manager EVS Broadcast Equipment S.A., Liege Science Park, 16 rue du Bois Saint-Jean, B-4102 Ougrée (Liège), Belgium Tel: +32 4 361 70 14. E-mail: [email protected]; www.evs-global.com

Forward Looking Statements

This press release contains forward-looking statements with respect to the business, financial condition, and results of operations of EVS and its affiliates. These statements are based on the current expectations or beliefs of EVS's management and are subject to a number of risks and uncertainties that could cause actual results or performance of the Company to differ materially from those contemplated in such forwardlooking statements. These risks and uncertainties relate to changes in technology and market requirements, the company's concentration on one industry, decline in demand for the company's products and those of its affiliates, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on pricing resulting from competition which could cause the actual results or performance of the company to differ materially from those contemplated in such forward-looking statements. EVS undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

About EVS Group

EVS Broadcast Equipment designs, develops and markets professional digital equipment for Television. The company employs over 365 persons in 14 countries and sells its products to professionals of the video and audio sectors in more than 90 countries. EVS is a public company traded on Euronext Brussels: EVS, ISIN: BE0003820371. For more information, refer to www.evs-global.com or www.evs.tv EVS Broadcast is the world leader for Live TV Production Digital Disk Recorders and Related Software Applications, especially in the field of sports. The company's dedicated hardware and software suite offer a complete production platform: live slow motion (LSM), high speed slow motion, replay only, clips generation, quick clips editing, real-time SD/HD video files transfer, time delay, multi-camera recording, metadata association, graphics storage and play-out, digital transmission, multi-format ingest and play-back, audio record & edit, webcasting, mobile phone clipping. Main software applications like the "IP Director®" are running on the dedicated robust and flexible hardware the "XT[2]® Platform". The world's leading broadcasters, such as NBC, BSkyB, FOX, RTBF, RTL, NHK, CANAL+, ABC, ESPN, TF1, CCTV, PBS, CBS, BBC, ZDF, Channel One, Channel7, RAI, TVE, NEP, MEDIAPRO, EUROMEDIA, BEXEL, ALFACAM and many others use EVS' solutions. EVS 41,3% affiliate XDC is the European leader for Digital Cinema technology and services in Europe with more than 3,500 committed digital screens in 11 European countries (Germany, Switzerland, Spain, Austria, Portugal, Belgium, The Netherlands, Hungary, Czech Republic, Slovakia and Poland) out of which 1,500 have already been deployed.

Condensed financial statements

ANNEX 1: EVS GROUP – IFRS CONSOLIDATED INCOME STATEMENT

(EUR thousands)	Note	4Q10 Unaudited	4Q09 Unaudited	2010 Audited	2009 Audited
Revenue	5.4	26,855	20,459	111,155	76,555
Costs of sales		-6,275	-3,877	-22,631	-13,945
Gross profit		20,580	16,581	88,524	62,611
Gross margin %		76.6%	81.0%	79.6%	81.8%
Selling and administrative expenses		-4,176	-2,510	-15,100	-11,890
Research and development expenses		-4,049	-3,378	-16,206	-12,340
Other revenue		4	72	207	213
Other expenses		-248	-23	-465	-128
Stock based compensation and ESOP plan		-35	-46	-617	-717
Amortization on acquired technology and IP		-162	-65	-550	-262
Amortization on Tax Shelter rights assets		-121	-60	-270	-238
Operating profit (EBIT)		11,794	10,571	55,524	37,249
Operating margin (EBIT) %		43.9%	51.7%	50.0%	48.7%
Net interest		39	84	120	482
Other net financial income / (expenses)	5.8	93	-35	-718	-535
XDC dilution profit	5.11	-	1,319	-	1,319
Share in the result of the enterprise accounted for using the equity method	5.11	142	321	-155	-1,656
Profit before taxes (PBT)		12,068	12,260	54,770	36,859
Income taxes	5.9	-3,905	-2,874	-16,712	-11,437
Net profit from continuing operations		8,163	9,386	38,058	25,422
Net profit		8,163	9,386	38,058	25,422
Attributable to :
Non controlling interests		-	-	-	-
Equity holders of the parent company		8,163	9,386	38,058	25,422
Net profit from operations, excl XDC – share of the group (1)	5.3	8,373	7,904	39,705	27,002
		4Q10	4Q09	2010	2009
RESULT PER SHARE (in number of shares and in EUR)	5.7	Unaudited	Unaudited	Audited	Audited
Weighted average number of subscribed shares for the period less treasury shares		13,481,728	13,558,825	13,511,048	13,554,643
Weighted average fully diluted number of shares		13,782,220	13,683,475	13,742,409	13,680,197
Basic earnings – share of the group		0.61	0.69	2.82	1.88
Fully diluted earnings – share of the group		0.59	0.69	2.77	1.86
Basic net profit from operations, excl XDC – share of the group		0.62	0.58	2.94	1.99

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(EUR thousands)		4Q10 Unaudited	4Q09 Unaudited	2010 Audited	2009 Audited
Net profit		8,163	9,386	38,058	25,422
Other comprehensive income of the period
Share-based payments		35	46	617	717

Currency translation differences 70 40 250 -76 Total comprehensive income for the period 4 8,268 9,472 38,925 26,063 Attributable to : Non controlling interests - 1 - 1 Equity holders of the parent company 4 8,268 9,473 38,925 26,064

ANNEX 2: EVS GROUP – IFRS CONSOLIDATED BALANCE SHEET

ASSETS (EUR thousands)	Note	Dec. 31, 2010 Audited	Dec. 31, 2009 Audited
Non-current assets :
Goodwill	5.10	820	-
Acquired technology and IP	5.10	1,704	721
Other intangible assets		197	532
Lands and buildings		11,169	11,261
Other tangible assets		1,821	1,870
Investment accounted for using equity method	5.11	6,071	6,378
Subordinated bonds	5.11	830	830
Other financial assets		391	333
Deferred tax assets		6	23
Total non-current assets		23,010	21,947
Current assets :
Inventories		12,420	8,506
Trade receivables		18,383	14,349
Other amounts receivable, deferred charges and accrued income		1,938	2,112
Cash and cash equivalents		27,946	33,311
Total current assets		60,688	58,278
Total assets		83,697	80,225

EQUITY AND LIABILITIES Note	Dec. 31, 2010	Dec. 31, 2009
(EUR thousands)	Audited	Audited
Equity :
Capital	8,342	8,342

Reserves	73,298	68,103
Interim dividends	-15,638	-13,561
Treasury shares	-5,253	-2,861
Total consolidated reserves	52,407	51,680
Translation differences	49	-200
Equity attributable to equity holders of the parent company	60,799	59,823
Minority interests	6	6
Total equity 4	60,806	59,829
Long term provisions	1,056	1,136
Deferred taxes liabilities	1,109	1,259
Financial long term debts	1,174	1,413
Other long term debts	546	546
Non-current liabilities	3,885	4,353
Short term portion of financial long term debts	295	299
Trade payables	3,331	4,863
Amounts payable regarding remuneration and social security	6,290	4,251

Income tax payable	4,978	758
Other amounts payable, advances received, accrued charges and deferred income	4,112	5,871
Current liabilities	19,007	16,043
Total equity and liabilities	83,697	80,225

ANNEX 3: EVS GROUP – IFRS CONSOLIDATED CASH FLOW STATEMENT

(EUR thousands)	2010 Audited	2009 Audited
Cash flows from operating activities
Operating Profit (EBIT)	55,524	37,249
Adjustment for non cash items :
- Amortization, depreciation and write-offs on fixed assets	3,079	2,056
- Foreign exchange result	-673	-567
- Stock based compensation and ESOP	617	717
- Provisions and deferred taxes increase/(decrease)	-211	72
	58,336	39,527
Increase (+)/decrease (-)
- Amounts receivable	-3,843	-4,228
- Accruals	-2,784	3,646
- Trade debts and prepayments	-1,192	1,421
- Taxes, remuneration and social security debts	6,005	-1,976
- Other amounts payable	295	-283
- Inventories	-3,881	-426
Cash generated from operations	52,936	37,681
Interest received	362	707
Income taxes	-16,712	-11,437
Net cash from operating activities	36,586	26,951

Cash flows from investing activities
Acquisition of Opencube, net cash acquired	-741	-
Purchase (-)/disposal (+) of intangible assets (incl. Investments in Tax Shelter)	-42	-383
Purchase (-)/disposal (+) of property, plant and equipment	-1,888	-3,013
Purchase (-)/disposal (+) of other financial assets	-5	-963
Net cash used in investing activities	-2,676	-4,359
Cash flows from financing activities
Operations with treasury shares	-3,417	-676
Other net equity variations	319	-75
Interest paid	-242	-225
Movements on long-term borrowings	-339	-299
Interim dividend paid	-15,557	-13,460
Final dividend paid	-20,039	-19,999
Net cash used in financing activities	-39,275	-34,734

Net increase/(decrease) in cash and cash equivalents	-5,365	-12,142

Cash and cash equivalents at beginning of period	33,311	45,454
Cash and cash equivalents at end of period	27,946	33,311

ANNEX 4: EVS GROUP – IFRS CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(EUR thousands)	Issued capital	Other reserves	Treasury shares	Currency translation differences	Equity attributable to shareholders of the parent company	Minority interest	Total equity
Balance as per December 31, 2008	8,342	71,427	-11,601	-124	68,044	5	68,049
Total comprehensive income for the period		26,139		-76	26,063	1	26,064
Operations with treasury shares		-9,415	8,739		-676		-676
Final dividend		-20,046			-20,046		-20,046
Interim dividend		-13,561			-13,561		-13,561
Other increase (decrease)		-			-		-
Balance as per December 31, 2009	8,342	54,544	-2,861	-200	59,823	6	59,829

(EUR thousands)	Issued capital	Other reserves	Treasury shares	Currency translation differences	Equity attributable to shareholders of the parent company	Minority interest	Total equity
Balance as per December 31, 2009	8,342	54,544	-2,861	-200	59,823	6	59,829

Total comprehensive income for the period		38,675		250	38,925		38,925
Increase (decrease) of equity resulting from company regrouping		420			420		420
Operations with treasury shares		-238	-2,392		-2,630		-2,630
Final dividend		-20,057			-20,057		-20,057
Interim dividend		-15,638			-15,638		-15,638
Other increase (decrease)		-45			-45		-45
Balance as per December 31, 2010	8,342	57,660	-5,253	49	60,799	6	60,806

ANNEX 5: EVS GROUP – NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2010

NOTE 1: BASIS OF PREPARATION

The consolidated financial statements of EVS Group for the 12 months period ended December 31, 2010 are established and presented in accordance with the International Financial Reporting Standards (IFRS), as adopted for use in the European Union.

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES AND METHODS

The accounting policies and methods adopted for the preparation of the Company's IFRS consolidated financial statements are consistent with those applied in the 2009 consolidated financial statements. The Company's IFRS accounting policies and methods are available in the 2009 annual report on www.evs-global.com.

NOTE 3: USE OF NON-GAAP FINANCIAL MEASURES

EVS uses certain non-GAAP measures in its financial communication. EVS does not represent these measures as alternative measures to net profit or other financial measures determined in accordance with IFRS. These measures as reported by EVS might differ from similar titled measures used by other companies. We believe that these measures are important indicators of our business and are widely used by investors, analysts and other parties. In the press release, the non-GAAP measures are reconciled to financial measures determined in accordance with IFRS.

The reconciliation between the net profit for the period and the net profit from operations, excl. XDC is as follows:

(EUR thousands)	FY10	FY09
Net profit for the period - IFRS	38,058	25,422
Allocation to Employees Profit Sharing Plan	285	638
Stock Option Plan	332	79
Amortization on acquired technology and IP	550	262
Amortization on Tax Shelter rights assets	270	238
Contribution of XDC (41.3% share in XDC net result)	210	1,683
XDC dilution profit	-	-1,319
Net profit from operations, excl. XDC	39,705	27,002

NOTE 4: SEGMENT REPORTING

4.1. General information

The company already applies IFRS 8 ("Operating segments") since the fiscal year ended on December 31, 2007.

From an operational point of view, the company is vertically integrated with the majority of its staff in the headquarters in Belgium, including the R&D, production, marketing and administration departments. This explains why the majority of the investments and costs are located at the level of the Belgian parent company. The foreign subsidiaries are primarily sales and representative offices. Sales relate to products of the same nature and are realized by commercial polyvalent teams.

The company internal reporting is the reflection of the abovementioned operational organization, and is characterized by the strong integration of the activities of the company; only sales are identified by geographical market in which they are realized.

By consequence, the company is composed of one segment according to the IFRS 8 definition, and the consolidated income statement of the group reflects this unique segment. However, it does not exclude a future evolution of the segmentation according to the development of the company, of its products and of its internal performance indicators.

4.2. Additional information

4.2.1. Information on products and services

Revenue can be presented by destination: the outside broadcast vans and the TV production studios. Maintenance and after sale service are included in the complete solution proposed to the clients.

4Q10	4Q09	% 4Q10/4Q09	Revenue (EUR thousands)	FY10	FY09	% FY10/FY09
13.3	13.0	+2.1%	Mobile production trucks / outside broadcast	55.7	51.9	+7.3%
13.6	7.5	+81.7%	TV production studios	55.5	24.7	+125.0%
26.9	20.5	+31.3%	Total Revenue	111.2	76.6	+45.2%

4.2.2. Geographical information

Activities are divided in three regions: Asia-Pacific ("APAC"), Europe, Middle East and Africa ("EMEA"), and America ("NALA").

4.2.2.1. Revenue

Revenue for the 12-months period (EUR thousands)	APAC	EMEA	NALA	TOTAL
FY10 revenue	21,132	60,957	29,066	111,155
Evolution versus FY09 (%)	+87.2%	+27.0%	+68.4%	+45.2%
Segment revenue at constant exchange rate	21,132	60,957	27,653	109,742
Variation versus FY09 (%) at constant exchange rate	+87.2%	+27.0%	+60.3%	+43.3%
Variation versus FY09 (%) at constant exchange rate and excluding big event rentals	+56.0%	+17.2%	+51.4%	+30.6%
FY09 revenue	11,289	48,011	17,256	76,555

Revenue for the quarter (EUR thousands)	APAC	EMEA	NALA	TOTAL
4Q10 revenue	6,314	16,399	4,142	26,855
Evolution versus 4Q09 (%)	+124.2%	+12.8%	+33.3%	+31.3%
Segment revenue at constant exchange rate	6,314	16,399	3,804	26,518
Variation versus 4Q09 (%) at constant exchange rate	+124.2%	+12.8%	+22.5%	+29.6%
Variation versus 4Q09 (%) at constant exchange rate and excluding big event rentals	+55.1%	+12.8%	+22.5%	+20.1%
4Q09 revenue	2,816	14,536	3,107	20,459

Sales from external clients in Belgium (the country of origin of the company) represent less than 10% of the total annual sales. In the last 12 months, the group realized significant sales to external clients (according to the definition of IFRS 8) in two countries: the US (EUR 22.1 million in the last 12 months, included in NALA in the above table) and the UK (EUR 13.0 million, included in EMEA).

4.2.2.2. Long term assets

Considering the explanations given in 4.1, all long term assets are located in the parent company EVS Broadcast Equipment S.A. in Belgium.

4.2.3. Information on important clients

No external client of the company represents more than 10% of the sales over the last 12 months.

NOTE 5: DIVIDENDS

The Ordinary General Meeting of May 18, 2010 approved the payment of a total gross dividend of EUR 2.48 per share, including the interim dividend of EUR 1.00 per share paid in November 2009.

The Board of Directors of November 15, 2010 decided the payment of an interim gross dividend of EUR 1.16 per share (EUR 0.87 per share after 25% withholding tax) for the fiscal year 2010, paid at the end of November 2010.

(EUR thousands)	# Coupon	2010	2009
- Final dividend for 2008 (EUR 1.48 per share less treasury shares)	8	-	20,046
- Interim dividend for 2009 (EUR 1.00 per share less treasury shares)	9	-	13,561
- Final dividend for 2009 (EUR 1.48 per share less treasury shares)	10	20,057	-
- Interim dividend for 2010 (EUR 1.16 per share less treasury shares)	11	15,638	-
Total dividends paid		35,695	33,607

The Board shall propose a total gross EUR 2.64 dividend (including the EUR 1.16 interim) amount to the Ordinary General Meeting of Shareholders to be held next May 17, 2011, implying a final gross dividend of EUR 1.48 to be paid June 1, 2011.

NOTE 6: EQUITY SECURITIES

The number of treasury shares has changed as follows during the period, together with the outstanding warrants at year-end:

	2010	2009
Number of own shares at January 1	78,675	330,134
Acquisition of own shares on the market	97,797	15,000
Sale of own shares on the market	-	-
Allocation to Employees Profit Sharing Plans	-5,481	-15,459
Sales related to Employee Stock Option Plan (ESOP) and other transactions	-30,588	-1,000
Own shares cancellation	-	-250,000
Number of own shares at December 31	140,403	78,675
Outstanding warrants at December 31	298,350	124,650

In 2010, the company repurchased 97,797 shares on the stock market. The Ordinary General Meeting of shareholders of May 18, 2010 approved the allocation of 5,481 shares to EVS employees (grant of 15 or 30 shares to each staff member) as a reward for their contribution to the group successes. Shares have also used as proceeds for the acquisition of businesses or exercise of warrants by beneficiaries. At year-end, the company owns 140,403 own shares at an average historical price of EUR 37.41.

In July, the Board of Directors decided to grant a total of 183,550 warrants to some employees at a strike price of EUR 34.52. As of December 31, 2010, 298,350 warrants were outstanding with an average strike price of EUR 39.36 and an average maturity of December 2014. However, only 47,650 warrants were exercisable and inthe-money at December 31, 2010.

NOTE 7: EARNINGS PER SHARE (EPS)

The group calculates both the basic earnings per share and the diluted earnings per share in accordance with IAS 33. The basic earnings per share are calculated on the basis of the weighted average number of ordinary shares in circulation during the period less treasury shares. The diluted earnings per share are calculated on the basis of the average number of ordinary shares in circulation during the period plus the potential dilutive effect of the warrants and stock options in circulation during the period less treasury shares.

NOTE 8: OTHER NET FINANCIAL INCOME / (EXPENSES)

(EUR thousands)	FY10	FY09
Exchange results from statutory accounts	-2,115	-328
Exchange results relating to IFRS consolidation methodology	1,443	-238
Other financial results	-46	31
Other net financial income / (expenses)	-718	-535

The functional currency of EVS Broadcast Equipment S.A. as well as all of the subsidiaries is the euro, except for the American EVS Inc. subsidiary, whose functional currency is the US dollar. The presentation currency of the consolidated financial statements of EVS Group is the euro. For more information on exchange rates, see also the annex 5.13.

NOTE 9: INCOME TAX

Reconciliation of the tax charge

The effective tax charge of the group obtained by applying the effective tax rate to the pre-tax profit of the group, has been reconciled for the two periods with the theoretical tax charge obtained by applying the theoretical tax rate:

(EUR thousands)	FY10	FY09
Reconciliation between the effective tax rate and the theoretical tax rate
Reported profit before taxes, share in the result of the enterp. accounted for using the equity
method and dilution profit	54,926	37,196
Reported tax charge based on the effective tax rate	-16,712	-11,437
Effective tax rate	30.4%	30.7%
Reconciliation items for the theoretical tax charge
Tax effect of Tax Shelter	-255	-255
Tax effect of deduction for notional interests	-261	-638
Tax effect of non deductible expenditures	387	321
Other increase /(decrease)	-186	-79
Total tax charge of the group entities computed on the basis of the respective local nominal
rates	-17,027	-12,089
Theoretical tax rate (relating to EVS operations, excl. XDC)	31.0%	32.5%

NOTE 10: ACQUISITION OF OPENCUBE TECHNOLOGIES

On April 6, 2010, EVS announced the acquisition of 100% of the share capital of OpenCube Technologies (France). The OpenCube team included approximately 15 people, mainly development engineers and operational experts. OpenCube Technologies sales amounted to EUR 1.9 million in 2010 compared to EUR 1.4 million in 2009, a continued growth since its creation, and is profitable. OpenCube Technologies is consolidated at 100% in the accounts of EVS Broadcast Equipment SA since April 1, 2010. EVS took EUR 1.6 million in its consolidated sales (9 months).

As a result of the acquisition, EUR 0.8 million has been recorded as goodwill and EUR 1.5 million as intangible asset for acquired Technology & IP.

Goodwill is the difference between the cost of an acquisition and the share of the acquirer's interest in the net fair value of the identifiable assets, certain liabilities and eventual liabilities. The goodwill is not depreciated but is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired, in accordance with IAS 36. The intangible asset is recognized at cost. It is depreciated on a straight-line basis over the duration of its economic utility estimated at 4 years and will be reviewed for impairment testing each time there is a sign of impairment in this intangible asset.

The assets and liabilities arising from the acquisition of OpenCube Technologies are as follows:

(EUR thousands)	April 1, 2010
Goodwill	820
Acquired technology & IP	1,532
Other non-current assets	141
Current assets	898
Liabilities	-739
Net assets acquired	2,652

NOTE 11: INVESTMENTS IN ASSOCIATES - XDC S.A.

EVS currently owns 41.3% of XDC S.A. share capital and has a fully diluted share of 30.2% in the company. As of December 31, 2010, XDC shares accounted for using equity method in EVS consolidated accounts, plus the EVS share of the subordinated bonds issued by XDC, amounted to EUR 6.4 million. It included EUR 0.8 million subscribed by EVS, at the end of September 2009, part of the consolidated EUR 15.9 million loan associated with warrants that has been formally issued last February 10, 2010, mainly to GIMV and SRIW.

The XDC accounts and their contribution into EVS consolidated accounts break down as follows:

(EUR thousands)	FY10	FY09
Revenue	61,158	9,545
EBITDA	8,700	1,224
Net result for the period	-509	-3,565
Part of XDC capital held by EVS	41.3%	47.2%
Net result – share of EVS	-210	-1,683
Dilution profit on XDC (from 47.2% to 41.3%)	-	1,319
Total contribution	-210	-364

The cumulated Tax Loss Carry Forward of XDC S.A. amounts to EUR 31.2 million on December 31, 2010. Deferred tax assets are being progressively recognized as the business plan materializes. As at December 31, 2010, 42.2% of deferred tax assets relating to these losses have been recognized.

NOTE 12: HEADCOUNT

EVS – TV (in full time equivalents)	As at December 31	Annual average
2010	366	326
2009	276	248
Variation	+32.6%	+31.5%

Starting January 1, 2010 with 276 full time equivalents, the group hired 90 people, net, in the last twelve months. The temporary decrease in the third quarter was due to the seasonal decrease in the number of free-lances and consultants.

NOTE 13: EXCHANGE RATES

The main exchange rate that influences the consolidated financial accounts is USD/EUR which has been taken into account as follows:

USD / EUR	Average exch. rate FY	Average exch. rate 4Q	At December 31
Exchange rate 2010	1.3263	1.3583	1.3362
Exchange rate 2009	1.3941	1.4778	1.4406
Variation	+5.1%	+8.8%	+7.8%

NOTE 14: FINANCIAL INSTRUMENTS

Periodically, EVS measures the group's anticipated exposure to transactional exchange risk over one year, mainly relating to the EUR/USD risk. Given the group has a "long" position in USD and based on sales forecasts, EVS hedges future USD net in-flows by forward foreign exchange contracts. The relevant hedging results are booked as financial results.

On December 31, 2010, the group held USD 9.0 million in forward exchange contracts earmarked to hedge 50% of the net future cash-flows in dollars with an average maturity date of July 4, 2011 and with an average exchange rate EUR/USD of 1.3238.

NOTE 15: SUBSEQUENT EVENTS

There is no significant subsequent event.

NOTE 16: RISK AND UNCERTAINTIES

Investing in the stock of EVS involves risks and uncertainties. The risks and uncertainties relating to the remainder of the year 2011 and similar to the risks and uncertainties that have been identified by the management of the company and that are listed in the management report of the annual report (available at www.evs-global.com).

NOTE 17: RELATED PARTY TRANSACTIONS

Except the grant of warrants to some Directors and members of the management of EVS, there were no significant related party transactions during 2010.