Alliance Distributors Holding Inc. Reports Fourth Quarter And Year End Financial Results

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Sep 06, 2012, 04:30 ET

NEW YORK, Sept. 6, 2012 /PRNewswire/ -- Alliance Distributors Holding Inc. (Pink Sheets: ADTR), a distributor of interactive video games and gaming products, today announced its financial results for the fourth quarter and fiscal year ended June 30, 2012.

Net sales for the three months ended June 30, 2012 were $10.3 million, compared to $10.4 million for the three months ended June 30, 2011. The company incurred a loss of $55,000 for the three months ended June 30, 2012, compared with net income of $8,000 for the three months ended June 30, 2011. The loss for the 2012 period included approximately $111,000 of expenses in connection with the closing of the Company's new credit facility with PNC Bank.

For the fiscal year ended June 30, 2012, net sales were $57 million, essentially flat with the year ended June 30, 2011. Net income increased to $428,000 for the year ended June 30, 2012 compared to $285,000 for the comparable 2011 period.

Jay Gelman, Chairman and Chief Executive Officer, said "We achieved stable results in an industry that contracted almost every month during the 12 months ended June 30, 2012, for a total industry contraction for the fiscal year of slightly over 20%. We proceeded into our new fiscal year on July 1 with the advantages that our new financing agreement gives us in lower financing costs and flexible terms."

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
THREE MONTHS AND YEARS ENDED JUNE 30, 2012 AND 2011
(In thousands, except per share amounts)


	Three Months		Year
	2012	2011	2012	2011


NET SALES	$10,333	$10,410	$ 56,773	$ 57,004

COST OF SALES	8,720	8,781	49,502	49,464

GROSS PROFIT	1,613	1,629	7,271	7,540

OPERATING COSTS AND EXPENSES	1,610	1,474	6,164	6,544

INCOME FROM OPERATIONS	3	155	1,107	996

Interest expense	92	147	390	532

INCOME (LOSS) BEFORE (BENEFIT FROM)
PROVISION FOR INCOME TAXES	(89)	8	717	464

Provision for (benefit from) income taxes	(34)	-	289	179

NET INCOME (LOSS)	$ (55)	$ 8	$ 428	$ 285

Net income per share – basic and diluted	$ -	$ -	$ 0.01	$ 0.01

Weighted average common shares outstanding –
Basic	44,157	46,746	44,157	51,353
Diluted	44,157	46,746	44,161	51,353

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 30, 2012 AND 2011
(in thousands)


	JUNE 30,
	2012	2011

ASSETS

CURRENT ASSETS:
Cash and equivalents	$ 581	$ 988
Accounts receivable-net	4,127	3,457
Inventory	5,531	6,581
Advances to suppliers	99	153
Prepaid expenses and other current assets	275	145
Deferred income taxes	196	268

Total current assets	10,809	11,592

PROPERTY AND EQUIPMENT – NET	106	153

DEFERRED INCOME TAXES	221	230

OTHER ASSETS	75	81

TOTAL	$11,211	$12,056

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Asset based revolving loan – bank	$ 2,912	$ -
Notes payable – bank	-	5,589
Current portion of long-term debt	500	-
Accounts payable	1,811	2,012
Accrued expenses and other current liabilities	332	240

Total current liabilities	5,555	7,841

LONG-TERM DEBT	1,000	-

STOCKHOLDERS' EQUITY	4,656	4,215

TOTAL	$11,211	$12,056

COMMON SHARES ISSUED AND OUTSTANDING	44,157	44,157

ALLIANCE DISTRIBUTORS HOLDING INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED JUNE 30, 2012 AND 2011
(in thousands)


	2012	2011

OPERATING ACTIVITIES:
Net income	$ 428	$ 285
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization	92	223
Provision for doubtful accounts	10	15
Stock-based compensation expense	13	31
Deferred income taxes	81	(36)
Other	36	10
Changes in operating assets and liabilities-net	201	(472)

Net cash provided by operating activities	861	56

INVESTING ACTIVITIES:
Purchase of property and equipment	(41)	(44)

Net cash used in investing activities	(41)	(44)

FINANCING ACTIVITIES:
Proceeds from asset based revolving loan – bank, net of repayments	2,912	-
Payment of note payable-bank, net of proceeds	(5,589)	-
Proceeds from note payable – bank, net of repayments	-	458
Proceeds from long-term debt	1,500
Purchase and retirement of common stock	-	(335)
Payment of deferred financing costs	(50)	(38)
Payment of long-term obligations	-	(15)

Net cash (used in) provided by financing activities	(1,227)	70

(DECREASE) INCREASE IN CASH AND EQUIVALENTS	(407)	82

CASH AND EQUIVALENTS, BEGINNING OF YEAR	988	906

CASH AND EQUIVALENTS, END OF YEAR	$ 581	$ 988