Alliance Distributors Holding Inc. Reports Financial Results For The Three Months And Six Months Ended December 31, 2012

News provided by

Feb 11, 2013, 04:30 ET

NEW YORK, Feb. 11, 2013 /PRNewswire/ -- Alliance Distributors Holding Inc. (Pink Sheets: ADTR), a distributor and developer of interactive video games, today announced its financial results for the three month and six month periods ended December 31, 2012.

Net sales for the three months ended December 31, 2012 decreased 13% to $18.1 million from $20.8 million in the three months ended December 31, 2011. Net income for the three months ended December 31, 2012 declined to $313,000 from $360,000 for the comparable period in 2011, and reflects approximately $67,000 in costs for outsourcing our warehouse operations and relocating our principal office to New York City.

For the six months ended December 31, 2012 net sales decreased 2% to $30.4 million from $31.1 million in the six months ended December 31, 2011. Net income for the six months ended December 31, 2012 declined to $329,000 from $406,000 for the comparable period in 2011, and reflects approximately $192,000 in costs for outsourcing our warehouse operations and relocating our principal office to New York City.

Jay Gelman, Chairman and Chief Executive Officer, said, "We are gratified that we were able to maintain profitability despite Hurricane Sandy, our outsourcing and relocation costs, and continuing weakness in the overall video game industry."

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®, PlayStation®Vita, PSP®, PS2®, Xbox 360® video game and entertainment system from Microsoft, Wii U, Wii, 3DS and DS, 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.

Xbox, Xbox 360 and Xbox LIVE are either registered trademarks or trademarks of the Microsoft group of companies.

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(In thousands, except per share amounts)
(unaudited)


	Three Months ended		Six Months ended
	December 31,		December 31,
	2012	2011	2012	2011

NET SALES	$18,132	$20,828	$30,396	$31,108

COST OF GOODS SOLD	15,809	18,455	26,336	27,216

GROSS PROFIT	2,323	2,373	4,060	3,892

OPERATING COSTS AND EXPENSES	1,689	1,662	3,228	3,009

INCOME FROM OPERATIONS BEFORE
SPECIAL CHARGES	634	711	832	883

Special charges	67	-	192	-

INCOME FROM OPERATIONS	567	711	640	883

Interest expense	48	110	95	198

INCOME BEFORE PROVISION FOR
INCOME TAXES	519	601	545	685

Provision for income taxes	206	241	216	279

NET INCOME	$ 313	$ 360	$ 329	$ 406

Net income per share:
Basic and diluted	$ 0.01	$ 0.01	$ 0.01	$ 0.01

Weighted average common shares outstanding:
Basic and Diluted	44,157	44,157	44,157	44,157

Note:

Special charges include costs incurred in connection with the outsourcing of the company's Bronx warehouse and relocation of its principle office to New York City.

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, 2012 and 2011
(unaudited, in thousands)


	December 31,
	2012	2011
ASSETS

CURRENT ASSETS:
Cash and equivalents	$ 566	$ 478
Accounts receivable-net	6,358	5,408
Inventory	8,748	5,985
Advances to suppliers	301	299
Prepaid expenses and other current assets	208	107
Deferred income taxes	276	213

Total current assets	16,457	12,490

PROPERTY AND EQUIPMENT – NET	172	129

DEFERRED INCOME TAXES	211	215

OTHER ASSETS	54	80

TOTAL	$16,894	$12,914


LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Asset-based revolving loan – bank	$ 2,765	$ -
Notes payable – bank	-	3,610
Current portion of long-term debt	500	-
Accounts payable	7,395	4,276
Accrued expenses and other current liabilities	484	401

Total current liabilities	11,144	8,287

LONG-TERM OBLIGATIONS	761	-


STOCKHOLDERS' EQUITY:
Common Stock, 44,157 shares issued and outstanding	44	44
Additional paid in capital	3,468	3,457
Retained earnings	1,477	1,126

Total stockholders' equity	4,989	4,627

TOTAL	$16,894	$12,914

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED DECEMBER 31, 2012 AND 2011
(unaudited, in thousands)


	2012	2011
OPERATING ACTIVITIES:
Net income	$ 329	$ 406
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization	35	45
Provision for doubtful accounts	-	10
Loss on disposition of assets	33	-
Deferred income taxes	(70)	70
Other	23	24
Changes in operating assets and liabilities-net	188	933

Net cash provided by operating activities	538	1,488

INVESTING ACTIVITIES:
Security deposit	(43)	-
Purchase of property and equipment	(113)	(19)

Net cash used in investing activities	(156)	(19)

FINANCING ACTIVITIES:
Repayments of asset-based revolving loan – bank, net of proceeds	(147)	-
Repayments of note payable, net of proceeds – bank	-	(1,979)
Payment of long-term debt	(250)	-

Net cash used in financing activities	(397)	(1,979)

DECREASE IN CASH AND EQUIVALENTS	(15)	(510)

CASH AND EQUIVALENTS, BEGINNING OF PERIOD	581	988

CASH AND EQUIVALENTS, END OF PERIOD	$ 566	$ 478