Chicago, IL / ACCESSWIRE / April 16, 2014 / CMG Holdings,
Inc. (OTCBB-CMGO) . For CMG Holdings, Inc., 2013 was a year of
tremendous changes and restructuring which we believe has resulted
in a solid foundation for future growth and exciting business
potential which we are confident can result in shareholder value
and returns.
I, along with a number of other CMG shareholders have for a long
time seen the potential in XA, The Experiential Agency, Inc. (“XA”)
and I initiated actions to try to ensure that XA’s potential is
realized. We have successfully restructured the entire CMG
Board of Directors, beginning with the addition of advertising
industry veterans Ronald Burkhardt and Jeffrey Devlin, with that
sole goal.
After spending a significant amount of time analyzing XA and its
business and operations, I reached the conclusion that XA needed
change from the top. Mr. Burkhardt is leading this initiative
with tremendous vision and a desire to create the industry leader
in the experiential advertising and marketing space. As set
forth in our annual report on Form 10-K, Mr. Burkhard, along with
Mr. Devlin and the rest of the management team are making changes
to allow XA to be more dynamic and proactive in order to win more
business and serve its clients better. Mr. Burkhardt has
developed a strategy for XA to enhance its reputation in the market
and to become an “Experiential Planet,” a one-world branding entity
where clients can realize all their brand marketing/engagement and
outreach objectives.
Already, XA’s preliminary un-audited numbers show that its
revenues have increased by more than 60% for the three months ended
March 31, 2014 as compared to the three months ended March 31, 2013
and its net income has increased by more than 60% as well. We
believe that this trend can continue through the remainder of this
year.
In order to grow XA’s business, it is pursuing a series of
acquisitions and strategic alliances and has initiated discussions
with smaller experiential branding/events companies and social
media and digital marketing firms. In addition, XA plans to
explore the acquisition of a boutique advertising/branding agency
to further XA’s reach as a one-stop shop and broaden our engagement
umbrella. XA also plans to expand by leveraging its blue-chip
roster of relationships and adding key staff to grow current
business in New York, expand our PR expertise and retainer revenues
in our Chicago headquarters office and ramp up and relocate our
office in Los Angeles from downtown to West Hollywood, where we
will be better positioned to attract TV, entertainment and movie
business. XA also plans to seek to open an office in the
social and film hotbed of Atlanta where there are key opportunities
and key relationship networks.
XA also plans to add high-gross margin generating corporate
training and video mapping divisions and to establish “XA Custom,”
where high-profile celebrities and/or high-net worth individuals
can access our unique skill sets for private or personal
engagements.
In order to provide better client service, XA is seeking to
create/identify creative “swat teams” capable of jumping in quickly
to handle excess workloads and to increase our response time in
pursuing new opportunities as they arise.
XA plans to launch a multi-media branding campaign to broaden
awareness of the XA brand and call attention to its creative
leadership in the experiential business. XA has already commenced a
weekly email outreach campaign to 5,000 key corporate and meeting
event planners in New York, Illinois, California, Georgia, Texas
and Florida.
The XA website is being re-designed and re-launched to reflect
more modern graphics, new client content, and to make it fully
responsive on all platforms, including mobile. XA has also
purchased state of the art Apple computers and equipment for its
New York office enabling even higher quality work produced at a
faster rate. In addition, they are used for video editing, which is
a billable profit center.
During 2013, CMG also made the decision to enter into a business
with what we believe to be tremendous potential – eSports
Gaming. Many of us are familiar with the growth of the online
gaming industry. However, upon looking at the actual
statistics, I was frankly stunned to see that according to Newzoo
BV there are 163.9 million online gamers worldwide with 15.38% of
them in the United States who play video games often
enough for it to be a full-time job. As a result, we
believe that eSports is not just a growing segment within the
gaming industry, but within the much larger entertainment industry.
It is not restricted by nationality, political affiliation, or
socioeconomic status. eSports principal barrier is a simple one –
internet access.
I am truly excited to have completed our acquisition of Good
Gaming, Inc. recently, having started investing in its business and
infrastructure during 2013. Good Gaming’s goal is to complete
its web platform and provide a subscription based service to gamers
to improve their gaming skills allowing them to compete in gaming
tournaments or even to become professional gamers. Good
Gaming has already signed veteran talent in the gaming community
and is broadening its network of veteran and pro players.
Good Gaming recently established a partnership with a leading
third party provider of an eSports tournament management system.
This partnership will provide a crucial backbone infrastructure for
Good Gaming’s proprietary tournament design and has done so at less
than 1/10th the cost originally expected due to diligent work by
our IT development team and the innovation of our partner.
Good Gaming anticipates that it will be able to announce key
publisher partnerships and agreements in the coming months that can
place it near the top of eSports entertainment and solidify its
projected membership base.
During 2013, CMG was finally able to begin to monetize its stake
in its former subsidiary, AudioEye, Inc. by sale of its shares held
by CMG. We have already deployed this money to build out the
business of Good Gaming and to pay off and eliminate “toxic” debt
that was negotiated by CMG’s former management. We now have
the fresh start that we needed to move forward.
The CMG website has been completely redesigned with the goal of
providing our shareholders and other interested parties with
current and complete information. I hope that you will visit
our new website once it is launched in the next several weeks.
As announced by CMG last week, I formally joined CMG as Chairman
of the Board of Directors and as Chief Executive Officer
transitioning from my former consultant position. I am
confident in the foundation I have helped to build, so much so,
that the bulk of my compensation is in the form of stock options
which were granted at the market price. Quite simply, I go as
CMG and its businesses go. I started out as a CMG
shareholder, and, for the most part, I remain in the same boat.
I appreciate the patience of all of our shareholders and I will
continue to work feverishly to reward it.
-Glenn Laken
Chairman & CEO
CMG Holdings
Caution Regarding Forward Looking Statements
Certain statements in this news release are forward-looking,
including (without limitation) expectations or guidance respecting
customer contract expansion, growing revenues and profits through
organic growth and acquisitions, attracting new business that will
increase the Company's revenues, continuing to maintain costs and
consummating any transactions. Undue reliance should not be placed
on such forward-looking statements because the matters they
describe are subject to known and unknown risks, uncertainties and
other unpredictable factors, many of which are beyond the Company's
control. The Company's actual results, performance and trends could
differ materially from those indicated or implied by such
statements as a result of various factors, including (without
limitation) the continued strengthening of the Company's selling
and marketing functions, continued customer satisfaction and
contract renewal, continued availability of capable dedicated
personnel, continued cost management, the success and availability
of acquisitions, availability of financing and other factors, as
well as by factors applicable to most companies such as general
economic, competitive and other business and civil conditions.
Information regarding certain of those and other risk factors and
cautionary statements that could affect future results, performance
or trends are discussed in the Company's most recent annual report
on Form 10-K, quarterly reports on Form 10-Q, and other filings
made with the Securities and Exchange Commission from time to time.
All of the Company's forward-looking statements are expressly
qualified by all such risk factors and other cautionary
statements.
Source: CMG Holdings
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