CMG Holdings Group, Inc. Reports Record Cash Flows
May 15 2014 - 3:20PM
Access Wire
CHICAGO, IL / ACCESSWIRE / May 15, 2014 / CMG Holdings Group,
Inc. (“OTCQB-CMGO”) filed its Quarterly Report on Form 10-Q for the
quarter ended March 31, 2014 in which CMGO announced revenues of
$1,554,748, net loss of $20,973 and deferred revenue of
$3,492,754. Taking into the account the deferred revenue, all
of which was billed, received and earned by CMGO during the
quarter, CMGO’s revenue and net income were $5,021,415 and
$1,192,361, respectively. As adjusted, the first quarter is
CMGO’s strongest in its history and its performance is
significantly more favorable than the forecast provided in CMGO’s
April 16, 2014 Chairman’s Letter. As set forth in that
letter, CMGO has been recruiting new management, and after the
first quarter, engaged qualified financial personnel to match the
quality of its other executives. CMGO’s goal is to continue
to build on its finance personnel to be able to track, report,
analyze and improve its business.
The deferred revenue relates to a Service Agreement for which
performance will be materially completed later today and will be
reported as part of CMGO’s GAAP revenues and net income in the
second quarter’s financial statements.
GAAP pronouncements, as applied to CMGO’s business, did not
allow for recognition of the generated revenues under this Service
Agreement in the first quarter, even though performance was
substantially completed, most of the progress payments required in
the Service Agreement were made and the language of the Service
Agreement itself dictates that the payments are earned when
received and are non-refundable. In accordance with GAAP,
CMGO recorded the billed amounts as deferred revenue. While
CMGO determined through discussions with its auditor that there was
no alternative presentation under GAAP available for its line of
business which would reflect the monies it had earned under the
contract, CMGO strongly believes that a non-GAAP presentation of
its earnings are warranted.
Chairman and CEO Glenn Laken commented, "We are coming off a
very strong quarter based on monies earned and cash flow and we
believe it is critical for investors to have an accurate picture of
CMGO’s performance. We are required to report GAAP numbers,
but with the deferred revenue actually earned, in the bank and
non-refundable, we believed it important to show this. We
believe that the table above provides a better picture of the state
of our business and enhances our shareholders’ understanding of our
financial performance."
About CMG Holdings Group, Inc.
CMG Holdings, Inc., through its subsidiaries, XA, The
Experiential Agency, Inc. and Good Gaming, Inc., operates in the
experiential marketing and gaming businesses. XA is a marketing
communications company focused on the operation of organizations in
the alternative advertising, digital media, experiential and
interactive marketing. XA delivers customized marketing solutions
that optimize profitability by concentrating resources in the
marketing communications industry. XA operates in the sectors of
experiential marketing and event marketing. Good Gaming is an
online gaming portal with a business objective of assisting eSports
gamers to hone and elevate their skills so as to enable them to
compete at a higher level in amateur through professional gaming
tournaments. Good Gaming plans to provide its targeted market with
access to its proprietary membership based eSports web platform and
to provide a service with a monthly membership fee to its target
market comprised of 16-25 year old, single, high school/college
level adults with disposable income and more than 10 hours of
invested game play weekly.
Non-GAAP Financial Measures
CMGO has presented above a non-GAAP financial measure of its net
income and revenue. The nearest GAAP measure to the adjusted
numbers provided above and the GAAP net income and revenue also
listed above.
These non-GAAP measures are not in accordance with, or a
substitute for, measures prepared in accordance with GAAP, and are
be different from non-GAAP measures used by other companies.
Non-GAAP measures have limitations in that they do not reflect all
of the amounts associated with CMGO’s results of operations that
would be reflected in measures determined in accordance with GAAP.
These measures should only be used to evaluate CMGO’s results of
operations in conjunction with corresponding GAAP measures.
These non-GAAP measures are provided to enhance investors'
overall understanding of the company's current financial
performance.
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.
Company Contact:
646.820.1580
info@cmgo.co
SOURCE: CMG Holdings Group, Inc.
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