2014

Onstream Media Corporation Reports Second Quarter Fiscal 2012 Results -- Reports Record High Revenues and Positive Cash from Operating Activities (before changes in working capital) --

POMPANO BEACH, Fla., May 15, 2012 /PRNewswire/ -- Onstream Media Corporation (NASDAQ: ONSM), a leading online service provider of live and on-demand corporate audio and web communications, virtual event technology and social media marketing, reported today its financial results for the second quarter of fiscal 2012, the six and three months ended March 31, 2012.

Financial Highlights

  • Revenues for the three months ended March 31, 2012 were approximately $4.7 million, representing a new record high for Onstream Media. Those second quarter revenues, which were 3.7% higher than revenues for the second quarter of fiscal 2011, also represented the seventh consecutive quarter of our revenues exceeding revenues for the corresponding quarter of the previous fiscal year.
  • Revenues for the six months ended March 31, 2012 were approximately $9.2 million, representing a 5.1% increase from the corresponding period of fiscal 2011.
  • Cash flow from operating activities (before changes in current assets and liabilities) for the six months ended March 31, 2012 was approximately $181,000, compared to cash used in operating activities of approximately $44,000 for the six months ended March 31, 2011.
  • Gross margin of approximately $3.1 million for the three months ended March 31, 2012, representing 65.5% of total revenues, was an increase of 3.7% as compared to the year-ago quarter. Gross margin of approximately $6.0 million for the six months ended March 31, 2012, representing 65.6% of total revenues, was an increase of 4.3% versus the comparable year-ago period.
  • Onstream's net loss for the three months ended March 31, 2012 was approximately $721,000, a 44.2% decrease as compared to a net loss of approximately $1.3 million for the second quarter of fiscal 2011. These losses included non-cash expenses for depreciation and amortization (approximately $358,000 and $367,000, for the three months ended March 31, 2012 and 2011, respectively) as well as other non-cash expenses, which are discussed in more detail below.
  • Onstream's net loss for the six months ended March 31, 2012 was approximately $1.4 million, a 37.2% decrease as compared to a net loss of approximately $2.2 million for the first six months of fiscal 2011. These losses included non-cash expenses for depreciation and amortization (approximately $715,000 and $753,000, for the six months ended March 31, 2012 and 2011, respectively) as well as other non-cash expenses, which are discussed in more detail below.

Financial Discussion

Our consolidated revenues of approximately $4.7 million for the three months ended March 31, 2012 represented a new record high for Onstream Media. Those revenues represented an increase of $167,000, or 3.7%, over our revenues for the three months ended March 31, 2011, with such increase due to higher sales from the Company's Audio and Web Conferencing Services Group. Those consolidated revenues of approximately $4.7 million for the three months ended March 31, 2012 also represented an increase of $142,000, or 3.2%, over our revenues for the immediately preceding quarter, the three months ended December 31, 2012.

Audio and Web Conferencing Services Group revenues were approximately $2.7 million for the three months ended March 31, 2012, an increase of approximately $392,000, or 16.7%, from the corresponding quarter of the prior fiscal year. This increase resulted from increased audio conferencing revenues in the Infinite division, which division's revenues of approximately $2,251,000 for the second quarter of fiscal 2012 represented a new record high for that division, surpassing the previous high which was just set in the immediately preceding quarter, the first quarter of fiscal 2012, which in turn was a new record versus the record  set in the fourth quarter of fiscal 2011.

As we announced at the time, the fourth quarter of fiscal 2011 included Infinite's first month ever in excess of 10 million minutes. We are now pleased to announce that all three months in the second quarter of fiscal 2012 were in excess of 10 million minutes, with one month in excess of 11 million minutes.

Digital Media Services Group revenues were approximately $1.9 million for the three months ended March 31, 2012, a decrease of approximately $225,000, or 10.5%, from the corresponding period of the prior fiscal year, primarily due to decreases in DMSP and hosting revenues as well as webcasting division revenues.

Onstream's second quarter fiscal 2012 net loss of approximately $721,000, or $(0.06) per share, was based on approximately 12.0 million weighted average shares outstanding and represented a 44.2% decrease from the second quarter fiscal 2011 net loss of approximately $1.3 million, or $(0.14) per share, which was based on approximately 9.5 million weighted average shares outstanding.

Onstream's net loss of approximately $1.4 million for the six months ended March 31, 2012 included approximately $1.6 million of non-cash items (non-cash expenses, net of non-cash income), resulting in approximately $181,000 positive cash flow from operating activities (before changes in current assets and liabilities) for that period. The primary non-cash expenses included in that net loss were depreciation and amortization and certain items (employee compensation, professional fees and interest) paid with equity.  The $181,000 positive cash flow from operating activities (before changes in current assets and liabilities) for the six months ended March 31, 2012 represented an improvement of approximately $225,000, as compared to cash used in operating activities of approximately $44,000 in the corresponding period of the previous fiscal year.  Cash flow from operating activities (before changes in current assets and liabilities) was positive for both the first and second quarters of fiscal 2012.

Onstream's consolidated revenues were approximately $9.2 million for the six months ended March 31, 2012 representing an increase of $444,000, or 5.1%, over our revenues for the six months ended March 31, 2011. This increase was due to higher sales from the Company's Audio and Web Conferencing Services Group, and in particular the Infinite division.

Onstream's net loss of approximately $1.4 million, or $(0.12) per share, for the first six months of fiscal 2012 was based on approximately 11.9 million weighted average shares outstanding and represented a 37.2% decrease from the net loss for the first six months of fiscal 2011 of approximately $2.2 million, or $(0.24) per share, which was based on approximately 9.1 million weighted average shares outstanding.

Management Commentary

Randy Selman, President and Chief Executive Officer of Onstream Media, stated, "We are pleased to report new revenue records for the most recently completed fiscal quarter, continuing such records achieved over our past six quarters. We were also pleased to continue to report positive cash flow from operating activities (before changes in current assets and liabilities) for the first six months of this fiscal year, continuing the pace set in fiscal 2011 when we reported our first full fiscal year having positive cash provided by operating activities (before changes in current assets and liabilities). Looking forward to the remainder of fiscal 2012, we believe that our core businesses, including conferencing and webcasting, are well positioned to continue to drive our revenue growth."

Mr. Selman added, "Although we have seen a recent decline in webcasting revenues, we believe that the future of this division will be favorably impacted by the comprehensive update to our webcasting platform which we expect to release on July 1, 2012. In addition, we recently implemented a new MarketPlace365 (MP365) pricing model that establishes MP365 as a value-added platform to assist the customer in using our webcasting services and more particularly, our webinar services. This new MP365 pricing model enables the show organizer to sell inexpensively or give away the exhibitor booths and instead charge for the webinars as a lead generation tool."

Teleconference

Management will hold a conference call on Wednesday, May 16, 2012 at 4:30 p.m. ET to discuss our financial results for the six and three months ended March 31, 2012, as well as provide an outlook for the remainder of fiscal 2012. Management discussion will be followed by an open Q&A session. Interested parties may listen to the presentation live online at http://www.visualwebcaster.com/event.asp?id=87123 or by calling 1-888-645-4404 or 201-604-0169. It is recommended to dial in approximately 10 to 15 minutes prior to the scheduled start time. An audio rebroadcast of the conference call will be archived for one year online at http://www.visualwebcaster.com/event.asp?id=87123.

About Onstream Media

Onstream Media Corporation (NASDAQ: ONSM) is a leading online service provider of live and on-demand corporate audio and web communications, virtual event technology and social media marketing. Onstream Media's innovative Digital Media Services Platform (DMSP) provides customers with cost effective tools for encoding, managing, indexing, and publishing content via the Internet. The company's MarketPlace365® solution enables publishers, associations, tradeshow promoters and entrepreneurs to rapidly and cost effectively self deploy their own online virtual marketplaces. In addition, Onstream Media provides live and on-demand webcasting, webinars, web and audio conferencing services. To date, almost half of the Fortune 1000 companies and 78% of the Fortune 100 CEOs and CFOs have used Onstream Media's services. Select Onstream Media customers include: AAA, Dell, Disney, Georgetown University, National Press Club, PR Newswire, Shareholder.com (NASDAQ), Sony Pictures and the U.S. Government. Onstream Media's strategic relationships include Akamai, BT Conferencing, Qwest and Trade Show News Network (TSNN). For more information, visit Onstream Media at http://www.onstreammedia.com or call 954-917-6655.

Cautionary Note Regarding Forward Looking Statements

Certain statements in this document and elsewhere by Onstream Media are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such information includes, without limitation, the business outlook, assessment of market conditions, anticipated financial and operating results, strategies, future plans, contingencies and contemplated transactions of the company. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors which may cause or contribute to actual results of company operations, or the performance or achievements of the company or industry results, to differ materially from those expressed, or implied by the forward-looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein, risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied for the forward- looking statements include, but are not limited to fluctuations in demand; changes to economic growth in the U.S. economy; government policies and regulations, including, but not limited to those affecting the Internet. Onstream Media undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Actual results, performance or achievements could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those set forth in Onstream Media Corporation's filings with the Securities and Exchange Commission.

Media Relations:                       

Investor Relations:

Chris Faust                                   

Jeff Ramson

FastLane Communications              

ProActive Newsroom

973-582-3498                                  

646-863-6341 

cfaust@fast-lane.net                   

jramson@proactivecrg.com

Financial Tables Follow

ONSTREAM MEDIA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS





Six months ended

March 31,

Three months ended

March 31,


2012

2011

2012

2011


(unaudited)

(unaudited)

REVENUE:




  Audio and web conferencing

$ 4,262,637

$ 3,650,516

$ 2,250,936

$ 1,841,056

  Webcasting

2,938,070

3,008,570

1,438,116

1,553,733

  DMSP and hosting

921,554

1,058,153

448,597

569,344

  Network usage

949,115

947,110

469,670

481,990

  Other

99,078

62,233

49,018

43,206

Total revenue

9,170,454

8,726,582

4,656,337

4,489,329






COSTS OF REVENUE:





  Audio and web conferencing

1,323,744

1,167,300

678,233

567,193

  Webcasting

869,559

793,973

437,562

434,696

  DMSP and hosting

461,734

516,600

221,940

295,095

  Network usage

463,571

428,485

247,226

219,779

  Other

34,735

53,937

21,294

32,298

Total costs of revenue

3,153,343

2,960,295

1,606,255

1,549,061






GROSS MARGIN

6,017,111

5,766,287

3,050,082

2,940,268






OPERATING EXPENSES:





  General and administrative:





    Compensation

4,106,269

4,396,456

2,110,393

2,285,947

    Professional fees

1,146,523

1,009,863

540,288

467,938

    Other

1,082,436

1,057,583

560,701

526,769

  Depreciation and amortization

714,622

753,438

358,114

367,241

Total operating expenses

7,049,850

7,217,340

3,569,496

3,647,895






Loss from operations

(1,032,739)

(1,451,053)

(519,414)

(707,627)






OTHER EXPENSE, NET:





  Interest expense

(385,197)

(543,852)

(202,349)

(243,512)

  Gain (loss) from adjustment of

    derivative liability to fair value

14,951

(202,006)

(8,100)

(340,667)

  Other income, net

29,553

8,669

9,269

1,257






Total other expense, net

(340,693)

(737,189)

(201,180)

(582,922)






Net loss

$ (1,373,432)

$ (2,188,242)

$ (720,594)

$ (1,290,549)






Loss per share – basic and diluted:










Net loss per share

$ (0.12)

$ (0.24)

$ (0.06)

$ (0.14)

Weighted average shares of common
stock outstanding – basic and diluted

11,924,999

9,118,201

11,998,381

9,502,669







 

ONSTREAM MEDIA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS





March 31,

2012

(unaudited)

September 30,

2011

 

ASSETS



CURRENT ASSETS:



   Cash and cash equivalents

$ 335,961

$ 290,865

Accounts receivable, net of allowance for doubtful accounts

2,529,567

2,453,390

   Prepaid expenses

437,260

580,185

   Inventories and other current assets

143,098

139,099

Total current assets

3,445,886

3,463,539

PROPERTY AND EQUIPMENT, net

2,676,907

2,714,676

INTANGIBLE ASSETS, net

534,282

785,927

GOODWILL, net

10,696,948

10,696,948

OTHER NON-CURRENT ASSETS

104,263

104,274

Total assets

$ 17,458,286

$ 17,765,364




LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:



   Accounts payable

$ 1,690,984

$ 1,573,703

   Accrued liabilities

1,429,391

1,193,473

   Amounts due to directors and officers

561,772

396,392

   Deferred revenue

77,174

96,437

   Notes and leases payable – current portion, net of discount

1,708,181

1,533,966

   Convertible debentures, net of discount

373,256

407,790

Total current liabilities

5,840,758

5,201,761

Notes and leases payable, net of current portion

6,790

11,962

Convertible debentures, net of discount

950,097

1,031,870

Detachable warrants, associated with sale of common shares

  and Series A-14 Preferred

173,260

188,211

Total liabilities

6,970,905

6,433,804




COMMITMENTS AND CONTINGENCIES






STOCKHOLDERS' EQUITY:



Series A-13 Convertible Preferred stock, par value $.0001 per share,

  authorized 170,000 shares, 17,500 and 35,000 issued and outstanding, 

respectively

2

3

Series A-14 Convertible Preferred stock, par value $.0001 per share,

authorized 420,000 shares, 420,000 issued and outstanding

42

42

Common stock, par value $.0001 per share; authorized 75,000,000 shares,

  12,294,909 and 11,779,521 issued and outstanding, respectively

1,229

1,177

Additional paid-in capital

140,824,741

140,291,514

Unamortized discount

(71,851)

(146,418)

Accumulated deficit

(130,266,782)

(128,814,758)

Total stockholders' equity

10,487,381

11,331,560

Total liabilities and stockholders' equity

$ 17,458,286

$ 17,765,364

 

SOURCE Onstream Media Corporation



RELATED LINKS
http://www.onstreammedia.com

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