NEW YORK, May 15, 2014 /PRNewswire/ -- YOU On Demand
Holdings, Inc. (NASDAQ: YOD) ("YOU On Demand" or the "Company" or
"YOD"), a leading multi-platform entertainment and Video On Demand
(VOD) company in China, announced
today its operating results for the three-month period ending
March 31, 2014 (a full copy of its
quarterly report on Form 10-Q will also be posted at
www.sec.gov).
Chairman Shane McMahon, CEO
Weicheng Liu and President & CFO
Marc Urbach are hosting an investor
webcast and analyst conference call today at 4:30 p.m. ET to discuss the Company's recent
operating results and provide an update on the ongoing progress.
The live and archived webcast will be available here, in the
'Webcasts and Events' section of the corporate.yod.com website. For
those wishing to dial in, please call +1 212 231 2905.
Questions will also be accepted and addressed, time permitting, via
emails to ir@yod.com.
Shane McMahon, Chairman of YOU On
Demand, commented, "The 2014 first quarter was a productive period
and we are very excited about what the future holds as we continue
to expand our distribution platform across IPTV, OTT and Mobile.
Due to the tremendous potential of these exciting technologies we
are refocusing our efforts and prioritizing these platforms.
Concurrently, we are also continuing to deploy YOD's China-based sales team in targeting the
numerous, but still fragmented digital cable MSO operators, with
the goal of further expanding our reach as this platform continues
to mature and our brand grows in popularity among consumers."
YOU On Demand CEO Weicheng Liu,
stated, "Our strong balance sheet, healthy cash position and a firm
commitment to prudent expense management, position the Company to
capitalize on the significant opportunities that lay ahead as we
continue leveraging the goodwill inherent in the YOD brand. We
believe that each of our business initiatives, across multiple
platforms, offers a unique shareholder return opportunity and we
remain confident that we will be able to unlock future value for
the benefit of all stakeholders."
2014 Q1 Operating Results
Revenue for the quarter ended March 31,
2014 increased to $138,000
from $938 in the quarter ended
March 31, 2013. Gross loss for the
quarter ended March 31, 2014 declined
to $738,000, from $848,000 in the quarter ended March 31, 2013. Total operating expenses for the
quarter ended March 31, 2014 declined
21.8% from the quarter ended March 31,
2013, which reflects the success of our strategy of forging
revenue-sharing agreements with content partners while keeping
corporate overhead at manageable levels. We reported a reduced loss
from operations of $2.7 million for
the quarter ended March 31, 2014,
down from $3.4 million in the prior
year period. Our net loss from continuing operations for the
quarter ended March 31, 2014
increased to $7.5 million from
$3.5 million in the prior year
period. Our net loss attributable to YOU on Demand common
shareholders was $23.6 million
(compared to $3.3 million in the
prior year period), which was impacted by several one-time,
non-cash items. These one-time, non-cash items include a
$16.4 million non-cash beneficial
conversion feature incurred as part of our Preferred Series E share
sale, as well as changes in the fair value of warrant liabilities
of $2.4 million and contingent
consideration of $0.7 million. The
reported per share loss from continuing operations for the quarter
ended March 31, 2014 was $1.48 as compared to $0.21 per share loss from continuing operations
in the prior year period.
Safe Harbor Statement
This press release contains certain statements that may include
"forward looking statements." All statements other than statements
of historical fact included herein are "forward-looking
statements." These forward looking statements are often identified
by the use of forward-looking terminology such as "believes,"
"expects" or similar expressions, involve known and unknown risks
and uncertainties. Although the Company believes that the
expectations reflected in such forward-looking statements are
reasonable, they do involve assumptions, risks and uncertainties,
and these expectations may prove to be incorrect. You should not
place undue reliance on these forward-looking statements, which
speak only as of the date of this press release. The Company's
actual results could differ materially from those anticipated in
these forward-looking statements as a result of a variety of
factors, including those discussed in the Company's periodic
reports that are filed with the Securities and Exchange Commission
and available on its website (http://www.sec.gov). All
forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by
these factors. Other than as required under the securities laws,
the Company does not assume a duty to update these forward-looking
statements.
About YOU On Demand Holdings, Inc.
(http://corporate.yod.com)
YOU On Demand (NASDAQ: YOD), is a leading multi-platform
entertainment company delivering premium content, including leading
Hollywood and China-produced movie titles, to customers
across China via Subscription
Video On Demand and Transactional Video On Demand. The Company has
secured alliances with leading global media operators and content
developers. YOU On Demand has content distribution agreements in
place with many of Hollywood's top
studios including Disney Media Distribution, Paramount Pictures,
NBC Universal, Warner Bros., Miramax Films, Lionsgate and Magnolia
Pictures, as well as a broad selection of the best content from
Chinese filmmakers. The Company has a comprehensive end-to-end
secure delivery system, governmental partnerships and approvals and
offers additional value-added services. YOU On Demand has strategic
partnerships with the largest media entities in China, a highly experienced management team
with international background and expertise in Cable, Television,
Film, Digital Media, Internet and Telecom. YOU On Demand is
headquartered in New York, NY with
its China headquarters in
Beijing.
CONTACT:
|
|
Jason
Finkelstein
|
Robert Rinderman or
Norberto Aja
|
YOU On
Demand
|
JCIR
|
212-206-1216
|
212-835-8500
|
jason.finkelstein@yod.com
|
YOD@jcir.com
|
@youondemand
|
|
- Financial Tables Follow
-
YOU On Demand
Holdings, Inc. and Its Subsidiaries
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2014
|
|
|
2013
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Revenue
|
$
|
137,681
|
|
$
|
938
|
|
Cost of
revenue
|
|
875,938
|
|
|
848,585
|
|
Gross loss
|
|
(738,257)
|
|
|
(847,647)
|
|
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
|
|
Selling, general and administrative expenses
|
|
1,640,640
|
|
|
1,983,736
|
|
Professional fees
|
|
185,484
|
|
|
251,434
|
|
Depreciation and amortization
|
|
149,960
|
|
|
292,833
|
|
Total operating
expense
|
|
1,976,084
|
|
|
2,528,003
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(2,714,341)
|
|
|
(3,375,650)
|
|
|
|
|
|
|
|
|
Interest & other
income / (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
(2,288,738)
|
|
|
(29,360)
|
|
Change in fair value of warrant liabilities
|
|
(2,439,018)
|
|
|
(25,405)
|
|
Change in fair value of contingent consideration
|
|
(703,126)
|
|
|
(41,648)
|
|
Loss on investment in unconsolidated entities
|
|
(4,908)
|
|
|
(2,994)
|
|
Gain on sale subsidiary
|
|
755,426
|
|
|
-
|
|
Loss on dissolution of variable interest entity
|
|
(27,463)
|
|
|
-
|
|
Other
|
|
(52,666)
|
|
|
(1,181)
|
|
|
|
|
|
|
|
|
Net loss from
continuing operations before income taxes and noncontrolling
interest
|
|
(7,474,834)
|
|
|
(3,476,238)
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
|
22,942
|
|
|
31,140
|
|
|
|
|
|
|
|
|
Net loss from
continuing operations
|
|
(7,451,892)
|
|
|
(3,445,098)
|
|
|
|
|
|
|
|
|
Net loss from
discontinued operations
|
|
-
|
|
|
(230,069)
|
|
|
|
|
|
|
|
|
Net loss
|
$
|
(7,451,892)
|
|
$
|
(3,675,167)
|
|
|
|
|
|
|
|
|
Plus: Net loss
attributable to noncontrolling interest
|
|
234,784
|
|
|
330,402
|
|
|
|
|
|
|
|
|
Net Loss attributable
to YOU On Demand shareholders
|
|
(7,217,108)
|
|
|
(3,344,765)
|
|
Dividends on
preferred stock
|
|
(16,402,161)
|
|
|
-
|
|
Net loss attributable
to You On Demand common shareholders
|
$
|
(23,619,269)
|
|
$
|
(3,344,765)
|
|
|
|
|
|
|
|
|
Basic loss per
share
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(1.48)
|
|
$
|
(0.21)
|
|
Loss from discontinued operations
|
$
|
-
|
|
$
|
(0.02)
|
|
Basic loss per share
|
$
|
(1.48)
|
|
$
|
(0.23)
|
|
|
|
|
|
|
|
|
Diluted loss per
share
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(1.48)
|
|
$
|
(0.21)
|
|
Loss from discontinued operations
|
$
|
-
|
|
$
|
(0.02)
|
|
Diluted loss per share
|
$
|
(1.48)
|
|
$
|
(0.23)
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
Basic
|
|
15,931,394
|
|
|
14,602,196
|
|
Diluted
|
|
15,931,394
|
|
|
14,602,196
|
|
YOU On Demand
Holdings, Inc. and Its Subsidiaries
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
March
31,
|
|
|
December
31,
|
|
|
|
2014
|
|
|
2013
|
|
|
|
(Unaudited)
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
|
17,954,910
|
|
$
|
3,822,889
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
186,715
|
|
|
175,211
|
|
Licensed content, current
|
|
1,070,036
|
|
|
428,322
|
|
Prepaid expenses
|
|
505,846
|
|
|
330,013
|
|
Debt issuance cost, net
|
|
-
|
|
|
128,879
|
|
Other current assets
|
|
57,683
|
|
|
48,928
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
19,775,190
|
|
|
4,934,242
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
433,400
|
|
|
499,858
|
|
Licensed content,
noncurrent
|
|
117,414
|
|
|
162,646
|
|
Intangible assets,
net
|
|
2,535,825
|
|
|
2,621,527
|
|
Goodwill
|
|
6,105,478
|
|
|
6,105,478
|
|
Investment in
unconsolidated entities
|
|
663,066
|
|
|
673,567
|
|
|
|
|
|
|
|
|
Total
assets
|
$
|
29,630,373
|
|
$
|
14,997,318
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts payable
|
$
|
1,167,185
|
|
$
|
656,545
|
|
Accrued expenses and liabilities
|
|
943,453
|
|
|
1,046,920
|
|
Deferred revenue
|
|
79,791
|
|
|
68,969
|
|
Deferred license fees
|
|
998,225
|
|
|
1,200,764
|
|
Other current liabilities
|
|
6,943
|
|
|
29,024
|
|
Contingent purchase price consideration liability
|
|
1,281,870
|
|
|
578,744
|
|
Convertible promissory note
|
|
3,000,000
|
|
|
3,000,000
|
|
Warrant liabilities
|
|
3,189,273
|
|
|
1,344,440
|
|
Total current
liabilities
|
|
10,666,740
|
|
|
7,925,406
|
|
|
|
|
|
|
|
|
Deferred tax
liability
|
|
102,867
|
|
|
125,809
|
|
Convertible
promissory note
|
|
-
|
|
|
2,000,000
|
|
Total
liabilities
|
|
10,769,607
|
|
|
10,051,215
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible
redeemable preferred stock, $.001 par value; 50,000,000 shares
authorized
|
|
|
|
Series A - 7,000,000
shares issued and outstanding, liquidation preference of
$3,500,000 at March 31, 2014 and December 31, 2013,
respectively
|
|
1,261,995
|
|
|
1,261,995
|
|
Series C – 87,500
shares issued and outstanding, liquidation
preference of $350,000 at March 31, 2014 and December 31, 2013,
respectively
|
|
219,754
|
|
|
219,754
|
|
Series D 4% - 0 and
2,285,714 shares issued and outstanding, liquidation
preference of $0 and $4,000,000 at March 31, 2014 and
December 31, 2013, respectively
|
|
-
|
|
|
4,000,000
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
Preferred Series E
stock, $.001 par value; 16,500,000 shares authorized, 14,285,714
and 0 shares issued at March 31, 2014 and December 31, 2013,
respectively
|
|
14,286
|
|
|
-
|
|
Common stock, $.001 par
value; 1,500,000,000 shares authorized, 16,097,154 and
15,794,762 shares issued at March 31, 2014 and December 31, 2013,
respectively
|
|
16,097
|
|
|
15,794
|
|
|
|
|
|
|
|
|
Additional paid-in
capital
|
|
109,865,767
|
|
|
67,417,025
|
|
|
|
|
|
|
|
|
Accumulated
deficit
|
|
(89,553,787)
|
|
|
(65,856,053)
|
|
|
|
|
|
|
|
|
Accumulated other
comprehensive loss
|
|
(1,324,359)
|
|
|
(715,090)
|
|
|
|
|
|
|
|
|
Total YOU On Demand
equity
|
|
19,018,004
|
|
|
861,676
|
|
|
|
|
|
|
|
|
Noncontrolling
interests
|
|
(1,638,987)
|
|
|
(1,397,322)
|
|
|
|
|
|
|
|
|
Total
equity
|
|
17,379,017
|
|
|
(535,646)
|
|
|
|
|
|
|
|
|
Total liabilities and
equity
|
$
|
29,630,373
|
|
$
|
14,997,318
|
|
SOURCE YOU On Demand Holdings, Inc.