Hollywood Media Corp. Reports 2013 Fourth Quarter And Year End Results

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Apr 07, 2014, 04:31 ET

GREEN BAY, Wis., April 7, 2014 /PRNewswire/ -- Hollywood Media Corp. (OTC Pink: HOLL) today reported unaudited financial results for the fourth quarter and year ended December 31, 2013.

On a continuing operations basis, which includes the contribution from Tekno Books, the Company's 100% owned subsidiary under the Intellectual Property division, net revenues for the 2013 fourth quarter were $0.1 million compared to $0.2 million in the prior-year period. For the full year 2013, net revenues were $0.4 million versus $0.6 million in 2012.

Loss from continuing operations for the 2013 fourth quarter, was $1.6 million, or $0.07 per share, compared to income from continuing operations for the 2012 fourth quarter of $4.8 million, or $0.21 per share. The income tax benefit of $3.8 million in the 2012 fourth quarter was fully offset by the income tax expense recognized in the Gain on sale of discontinued operations, net of income taxes. Income from continuing operations for the full year 2013 was $6.3 million, or $0.28 per share. This compared to income from continuing operations for the full year 2012 of $0.9 million, or $0.04 per share, which included a non-cash goodwill impairment charge of $3.6 million in the third quarter of 2012 related to the Company's Ad Sales Division. The income tax benefit of $5.3 million for the full year 2012 was fully offset by the income tax expense recognized in the Gain on sale of discontinued operations, net of income taxes.

Net loss, which includes discontinued operations, was $1.6 million, or $0.07 per share, in the 2013 fourth quarter, compared to net income of $11.8 million, or $0.51 per share, in the prior-year period. For the full year 2013, net income, which includes discontinued operations was $6.3 million, or $0.28 per share, compared to net income in 2012 of $10.4 million, or $0.45 per share.

At December 31, 2013, the Company had cash and cash equivalents of $22.9 million and no debt as compared to cash and cash equivalents of $11.4 million and no debt at December 31, 2012.

On August 8, 2013, the Company entered into the Transaction Agreement (the "Agreement") among Key Brand Entertainment Inc. ("Key Brand"), Theatre Direct NY, Inc. ("Theatre Direct"), and the Company for the prepayment by Key Brand in full of the amount owed to the Company pursuant to the loan (the "Loan") under the Second Lien Credit, Security and Pledge Agreement, dated as of December 15, 2010, among Key Brand, Theatre Direct, and the Company, as amended. Pursuant to the Agreement, Key Brand paid to the Company on August 8, 2013 in cash the amount of $13,861,738, which constituted the outstanding principal plus accrued interest through August 8, 2013 of the Loan.

In addition, pursuant to the Agreement, Theatre Direct redeemed a warrant ("Warrant") to purchase shares of common stock of Theatre Direct held by the Company. The redemption price for the Warrant was $2,750,000 and was paid on August 8, 2013 to the Company. Accordingly, the Company received on August 8, 2013 a total of $16,611,738 consisting of $13,861,738 from the prepayment of the Loan and $2,750,000 from the redemption of the Warrant.

About Hollywood Media Corp.

Hollywood Media Corp. is comprised primarily of an Ad Sales division and an Intellectual Property division.

Note on Forward-Looking Statements
2013 fourth quarter and year end results are unaudited. Statements in this press release may be "forward-looking statements" within the meaning of federal securities laws. The matters discussed herein that are forward-looking statements are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous potential risks and uncertainties, including, but not limited to, our ability to realize anticipated revenues and cost efficiencies, the impact of potential future dispositions or other strategic transactions by Hollywood Media Corp., our ability to develop and maintain strategic relationships, technology risks, the volatility of our stock price, and other risks and factors described in Hollywood Media Corp.'s filings with the Securities and Exchange Commission including our Form 10-K for 2012. Such forward-looking statements speak only as of the date on which they are made.

Attached are the following financial tables:

CONDENSED CONSOLIDATED BALANCE SHEETS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

		December 31,	December 31,
		2013	2012
		(unaudited)	(audited)
ASSETS

CURRENT ASSETS:
	Cash and cash equivalents	$ 22,937,557	$ 11,378,519
	Prepaid expenses	890,351	329,915
	Other receivables	101,131	75,105
	Notes receivable, current	33,603	1,375,545
	Related party receivable	2,066	37,287
	Current portion of deferred compensation	430,000	430,000
	Total current assets	24,394,708	13,626,371

PROPERTY AND EQUIPMENT, net		355,640	240,645
INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED INVESTEES		151,492	138,384
INTANGIBLE ASSETS, net		249	8,683
GOODWILL		6,200,000	6,200,000
OTHER ASSETS		195,928	727,982
NOTES RECEIVABLE, less current portion		84,007	4,455,106
WARRANT		-	700,000
DEFERRED COMPENSATION, less current portion		88,651	518,651
	TOTAL ASSETS	$ 31,470,675	$ 26,615,822

	LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
	Accounts payable	$ 77,952	$ 414,123
	Accrued expenses and other	714,556	1,036,788
	Deferred revenue	79,938	111,669
	Current portion of capital lease obligations	7,480	16,255
	Total current liabilities	879,926	1,578,835

CAPITAL LEASE OBLIGATIONS, less current portion		26,770	2,152
OTHER DEFERRED LIABILITY		-	355
DEFERRED REVENUE		8,650	14,000
DERIVATIVE LIABILITIES		480,000	60,000
	TOTAL LIABILITIES	1,395,346	1,655,342

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
	Preferred Stock, $.01 par value, 1,000,000 shares authorized; none outstanding	-	-
	Common Stock, $.01 par value, 100,000,000 shares authorized; 22,386,192 and 23,162,466 shares issued and outstanding at December 31, 2013 and December 31, 2012, respectively	223,862	231,625
	Additional paid-in capital	292,461,667	293,591,903
	Accumulated deficit	(262,610,200)	(268,863,048)
	Total shareholders' equity	30,075,329	24,960,480
	TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 31,470,675	$ 26,615,822

HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



	YEAR ENDED DECEMBER 31,		THREE MONTHS ENDED DECEMBER 31,
	2013	2012	2013	2012
	(unaudited)	(audited)	(unaudited)	(unaudited)

NET REVENUES	$ 424,751	$ 616,338	$ 101,306	$ 187,256

OPERATING COSTS AND EXPENSES
Editorial, production, development and technology	231,644	639,865	49,910	248,362
Selling, general and administrative	3,186,425	2,854,440	607,283	1,014,450
Payroll and benefits	1,820,867	2,688,017	482,090	1,068,530
Depreciation and amortization	73,169	136,443	14,270	23,411

Total operating costs and expenses	5,312,105	6,318,765	1,153,553	2,354,753

Loss from operations	(4,887,354)	(5,702,427)	(1,052,247)	(2,167,497)


LOSSES OF UNCONSOLIDATED INVESTEES
Equity in losses of unconsolidated investees	(187,616)	(142,003)	(187,724)	(152)
Impairment loss	-	(3,600,000)	-	-
Total equity in losses of unconsolidated investees	(187,616)	(3,742,003)	(187,724)	(152)

OTHER INCOME
Interest, net	1,181,104	1,249,868	6,060	472,457
Accretion of discount, net of allowance for uncollectability	1,468,757	1,717,900	-	1,717,900
Other, net	8,878,922	2,068,665	(418,504)	960,353
Total other income	11,528,783	5,036,433	(412,444)	3,150,710

Income (loss) from continuing operations before income taxes	6,453,813	(4,407,997)	(1,652,415)	983,061
Income tax (expense) benefit	(200,965)	5,326,300	25,883	3,827,818
Income (loss) from continuing operations	6,252,848	918,303	(1,626,532)	4,810,879

Gain on sale of discontinued operations, net of income taxes	-	9,468,677	-	7,023,786
Income from discontinued operations	-	22,584	-	-

Income from discontinued operations	-	9,491,261	-	7,023,786

Net income (loss)	$ 6,252,848	$ 10,409,564	$ (1,626,532)	$ 11,834,665


Basic and diluted income (loss) per common share
Continuing operations	$ 0.28	$ 0.04	$ (0.07)	$ 0.21
Discontinued operations	-	0.41	-	0.30
Total basic and diluted net income (loss) per share	$ 0.28	$ 0.45	$ (0.07)	$ 0.51

Weighted average common and common equivalent shares outstanding - basic and diluted
	22,646,231	23,178,814	22,521,887	23,179,066