2014

Alliance Distributors Holding Inc. Reports Third Quarter and Nine-Month Financial Results

NEW YORK, May 12, 2011 /PRNewswire/ -- Alliance Distributors Holding Inc. (Pink Sheets:  ADTR), a distributor of interactive video games and gaming products, today announced its financial results for the three-month and nine-month periods ended March 31, 2011.

Net sales for the three months ended March 31, 2011 decreased 21% to $16 million from $20.2 million in the three months ended March 31, 2010.  Net income for the three months ended March 31, 2011 was $7,000, compared to $235,000 for the comparable period in 2010.

For the nine months ended March 31, 2011, net sales decreased 22% to $46.6 million from $60.1 million in the nine months ended March 31, 2010.  Net income for the nine months ended March 31, 2011 was $277,000, compared to $678,000 for the comparable period in 2010.

In April 2011, the company repurchased approximately 8.7 million shares of its common stock for $337,000. The transaction reduced the number of the company's outstanding shares to 44,157,000.

"We continued to see a challenging market in video games during the quarter ended March 31, 2011," said Jay Gelman, Chairman and Chief Executive Officer. "Despite another quarter of growth in value software sales, persistent weakness in frontline software and console sales continues to be a major contributing factor to our overall decline in sales.

"Our Metaversal subsidiary recently released Bad Apples: Battle Harvest in the iTunes Appstore where it is available for $1.99, along with a free version, Bad Apples:  Battle Harvest Lite.  The new application is currently featured on the 'New and Noteworthy' section of the Appstore. We previously noted that Metaversal's Shave Me! game was the second or third most frequently downloaded free application in the iTunes Appstore for a brief period in April."

Timing of Conference Call with Q&A

Alliance Distributors will conduct an earnings conference call, including a question and answer period, at 3:00 PM ET on May 26, 2011.

The call-in number for the conference call is:

888-263-2884  (Pass code:  6277057)

About Alliance Distributors Holding Inc.

Alliance Distributors Holding Inc. (www.alliancedistributors.com), which does business as Alliance Distributors, is a full-service wholesale videogame distributor, specializing in gaming products and accessories for all key manufacturers and 3rd party publishers. Alliance Distributors offers support on: PS3, PSP, PS2, X-Box 360, Wii, DS and GBA SP, peripherals and software titles. Alliance develops downloadable and social content video games through Metaversal Studios (www.metaversalstudios.com), which it wholly-owns.

Safe Harbor

Certain statements contained in this press release contain forward-looking statements including without limitation, statements concerning our operations, economic performance, and financial condition.  The words "estimate," "believe," "expect," "should" and "anticipate" and other similar expressions generally identify forward-looking statements, which speak only as of their dates.

Investors are cautioned that all forward-looking statements, which are based largely on our current expectations, involve risks and uncertainty. Actual results, events and circumstances (including future performance, results and trends) could differ materially from those set forth in such statements due to various factors, risks and uncertainties, including without limitation, risks associated with technological change, competitive factors and general economic conditions, including the related impact on discretionary consumer spending, changes in marketing and distribution strategies by manufacturers, continued shortages of new platform systems, timely development and release of video game products we produce, potential cost overruns in our development of video games, ability to protect our intellectual property rights, potential claims that we have infringed the intellectual property rights of others, market acceptance of games we develop, ability to realize anticipated benefits of acquisitions, potential undiscovered liabilities of companies that we acquire, changes in our business or growth strategy, the emergence of new or growing competitors, various other competitive and technological factors. There can be no assurance that the results referred to in the forward-looking statements contained in this release will occur. The Company has no duty and undertakes no obligation to update any forward-looking information, whether as a result of new information, future developments or otherwise.

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARY

CONSOLIDATED INCOME STATEMENTS

(In thousands, except per share amounts)

(unaudited)






Three Months ended


Nine Months ended


March 31,


March 31,


2011

2010


2011

2010







NET SALES

$15,968

$20,152


$46,594

$60,109







COST OF GOODS SOLD

14,123

17,631


40,808

52,663







GROSS PROFIT

1,845

2, 521


5,786

7,446







OPERATING COSTS AND EXPENSES

1,699

2,001


4,945

6,013







INCOME FROM OPERATIONS

146

520


841

1,433







Interest expense

140

120


385

323







INCOME BEFORE PROVISION FOR






    INCOME TAXES

6

400


456

1,110







(Benefit from) provision for income taxes

(1)

165


179

432







NET INCOME

$     7

$   235


$    277

$    678







Net income per share:






    Basic and diluted

$      -

$      -


$ 0.01

$ 0.01







Weighted average common shares outstanding:






    Basic and Diluted

52,883

52,883


52,883

52,883










ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2011 and 2010

(unaudited, in thousands)



March 31,


2011

2010

ASSETS






CURRENT ASSETS:



    Cash and equivalents

$     516

$     732

    Accounts receivable-net

8,115

7,118

    Inventory

8,735

6,696

    Advances to suppliers

171

128

    Prepaid expenses and other current assets

177

180

    Deferred income taxes

291

300




         Total current assets

18,005

15,154




PROPERTY AND EQUIPMENT – NET

187

339




DEFERRED INCOME TAXES

231

181




OTHER ASSETS

71

107




TOTAL

$18,494

$15,781







LIABILITIES AND STOCKHOLDERS' EQUITY






CURRENT LIABILITIES:



    Notes payable – bank

$  9,236

$  6,176

    Accounts payable

4,364

4,711

    Accrued expenses and other current liabilities

351

695




         Total current liabilities

13,951

11,582




DEFERRED LEASE OBLIGATIONS

5

34







STOCKHOLDERS' EQUITY

4,538

4,165




TOTAL

$18,494

$15,781


COMMON SHARES OUTSTANDING

52,883

52,883



ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED MARCH 31, 2011 AND 2010

(unaudited, in thousands)





2011

2010

OPERATING ACTIVITIES:



    Net income

$    277

$    678

    Adjustments to reconcile net income to net cash used in



         operating activities:



         Depreciation and amortization

180

173

         Provision for doubtful accounts

15

125

         Equity compensation  expense

27

41

         Deferred income taxes

(60)

152

         Other

5

13

         Changes in operating assets and liabilities-net

(4,887)

(2,495)




              Net cash used in operating activities

(4,443)

(1,313)




INVESTING ACTIVITIES:



    Purchase of property and equipment

(37)

(90)

    Acquisition of assets of Metaversal Studios

-

(25)

    Note Receivable in connection with acquisition

 -

(30)




              Net cash used in investing activities

(37)

(145)




FINANCING ACTIVITIES:



    Proceeds from note payable, net of repayments – bank

4,105

1,368

    Payment of long-term obligations

(15)

(8)




              Net cash provided by financing activities

4,090

1,360




(DECREASE) IN CASH AND EQUIVALENTS

(390)

(98)




CASH AND EQUIVALENTS, BEGINNING OF PERIOD

906

830




CASH AND EQUIVALENTS, END OF PERIOD

$   516

$   732







SOURCE Alliance Distributors Holding Inc.



RELATED LINKS
http://www.alliancedistributors.com

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