NEW YORK, Nov. 13, 2014 /PRNewswire/ -- YOU On Demand
Holdings, Inc. (NASDAQ: YOD) ("YOU On Demand" or the "Company"), a
leading Video On Demand service provider in China delivering Hollywood movies to mobile and TV screens,
today announced its financial results for the three- and nine-month
periods ended September 30, 2014 (a
full copy of its quarterly report on Form 10-Q will be posted at
www.sec.gov). Chairman Shane
McMahon, CEO Weicheng Liu and
President and CFO Marc Urbach are
hosting an investor update conference call today at 4:30 p.m. ET to discuss the Company's recent
results. To join the webcast, please visit the 'Webcasts and
Events' section of the YOD corporate website,
http://corporate.yod.com/webcasts. Otherwise, the toll-free
dial-in is: 877/407-3107; international callers should dial:
201/493-6796.
Shane McMahon, Chairman of YOU On
Demand, commented, "As evidenced from our strong Q3 revenues which
grew 253% quarter-over-quarter, YOU On Demand is beginning to show
the fruit of a tremendous amount of planning and hard work.
In China, as the appetite for
premium content and the breadth of distribution channels continues
to grow, YOU On Demand is now firmly entrenched and well-positioned
to capitalize."
YOU On Demand CEO Weicheng Liu,
stated, "We are very pleased with the traction we are now
witnessing when it comes to revenue growth and consumer
uptake. It is directly attributed to both the tremendous
effort of the YOU On Demand team as well as the growing Chinese
middle-class consumers who are now showing a very convincing desire
to pay for premium content that is delivered to their mobile and TV
screens with the highest quality. Our service strategy
remains the same: to offer a unique and differentiated service to
an audience of China's most
passionate movie fans. Through organic growth and continued
expansion of distribution partnerships, we believe YOU On Demand is
decisively executing on its plan to be the number one destination
for movie fans across mobile and TV screens."
YOU On Demand President & CFO Marc
Urbach commented, "YOU On Demand had a strong start to the
second half of 2014 as we intensified our commitment to delivering
high quality entertainment across a spectrum of consumer devices
and screens. There are many opportunities that lie ahead and we
expect to best leverage these by maintaining our fiscally prudent
strategy for the long-term benefit of the Company's
shareholders."
2014 Q3 Operating Results
Revenues for Q3 were approximately $645,000, an increase of 253% over Q2 2014 and an
increase of 577% over Q3 in the prior year.
Our gross loss for the quarter amounted to $228,000, down from $617,000 in the same period in the prior
year.
The loss from operations of $2.3
million for the quarter was down from a $2.6 million loss from operations in the
comparable 2013 period. The net loss attributable to YOU On
Demand shareholders for the Q3 2014 quarter amounted to
$1.9 million, compared to $3.2
million income in the prior year quarter, which included $5.6
million income from discontinued operations.
The loss per share on a fully diluted basis for Q3 2014 was
$0.09 compared to $0.14 income per share in the year-ago Q3 which
included $0.36 income per share from discontinued
operations.
Cash and cash equivalents increased from $3.8 million at December
31, 2013, to $13.0 million at
September 30, 2014.
Guidance
For full-year fiscal 2014, YOU On Demand now expects total
revenue to be in the range of $1.7 million -
$2.0 million. The change in guidance is directly
attributable to longer-than-anticipated finalization of
distribution agreements and therefore certain revenues being
delayed to 2015.
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 risk factors set forth
from time to time the Company's periodic reports, including but not
limited to its Annual Report on Form 10-K for the fiscal year ended
December 31, 2013, 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
YOU On Demand
212-206-1216
jason.finkelstein@yod.com
@youondemand
Financial Tables Follow
|
YOU On Demand
Holdings, Inc., Its Subsidiaries and Variable Interest
Entity
|
|
|
|
|
|
|
|
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
Ended
|
|
|
|
Sep 30,
2014
|
Sep 30,
2013
|
|
Sep 30,
2014
|
Sep 30,
2013
|
|
Revenue
|
644,891
|
95,295
|
|
965,268
|
146,852
|
|
Cost of
revenue
|
873,025
|
712,327
|
|
2,606,142
|
2,350,931
|
|
Gross
loss
|
(228,134)
|
(617,032)
|
|
(1,640,874)
|
(2,204,079)
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Selling, general and
administrative expense
|
1,861,053
|
1,726,967
|
|
5,772,350
|
5,856,484
|
|
|
Professional
fees
|
114,271
|
78,379
|
|
375,986
|
474,114
|
|
|
Depreciation and
amortization
|
124,936
|
154,719
|
|
414,486
|
620,946
|
|
|
Impairments of
long-lived assets
|
-
|
-
|
|
-
|
311,249
|
|
Total operating
expenses
|
2,100,260
|
1,960,065
|
|
6,562,822
|
7,262,793
|
|
Loss from
operations
|
(2,328,394)
|
(2,577,097)
|
|
(8,203,696)
|
(9,466,872)
|
|
|
|
|
|
|
|
|
|
Interest &
other income/(expenses)
|
|
|
|
|
|
|
|
Interest expense,
net
|
(29,151)
|
(29,818)
|
|
(2,346,210)
|
(88,882)
|
|
|
Change in fair value
of warrant liabilities
|
281,537
|
(6,840)
|
|
(655,849)
|
(37,130)
|
|
|
Change in fair value
of contingent consideration
|
(47,634)
|
(15,649)
|
|
(160,766)
|
(99,343)
|
|
|
Gain/(loss) on
investment in unconsolidated entities
|
(6,389)
|
8,592
|
|
(16,646)
|
7,873
|
|
|
Gain on sale of a
subsidiary
|
-
|
-
|
|
755,426
|
-
|
|
|
Loss on dissolution
of a variable interest entity
|
-
|
-
|
|
(27,463)
|
-
|
|
|
Others
|
(14,783)
|
(11,827)
|
|
(82,464)
|
58,769
|
|
Net loss
before income tax and non-
controlling
interest
|
(2,144,814)
|
(2,632,639)
|
|
(10,737,668)
|
(9,625,585)
|
|
Income tax
benefit
|
28,812
|
21,168
|
|
84,249
|
82,129
|
|
Loss from continuing
operations
|
(2,116,002)
|
(2,611,471)
|
|
(10,653,419)
|
(9,543,456)
|
|
Net income from
discontinued operations
|
-
|
5,589,872
|
|
-
|
5,255,474
|
|
Net
income/(loss)
|
(2,116,002)
|
2,978,401
|
|
(10,653,419)
|
(4,287,982)
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
169,364
|
193,512
|
|
696,708
|
834,685
|
|
Net
income/(loss) attributable to YOU On
Demand
shareholders
|
(1,946,638)
|
3,171,913
|
|
(9,956,711)
|
(3,453,297)
|
|
Dividend on preferred
stock
|
-
|
(1,029,829)
|
|
(16,402,161)
|
(1,029,829)
|
|
Net
income/(loss) attributable to YOU On
Demand common
shareholders
|
(1,946,638)
|
2,142,084
|
|
(26,358,872)
|
(4,483,126)
|
|
|
|
|
|
|
|
|
|
Basic and diluted
loss per share:
|
|
|
|
|
|
|
|
Loss from continuing
operations
|
$
(0.09)
|
(0.22)
|
|
$
(1.45)
|
$
(0.65)
|
|
|
Income from
discontinued operations
|
-
|
0.36
|
|
-
|
0.35
|
|
|
Basic and diluted
income/(loss) per share
|
$
(0.09)
|
$
0.14
|
|
$
(1.45)
|
$
(0.30)
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic and
diluted
|
22,012,166
|
15,553,097
|
|
18,203,124
|
15,034,841
|
|
YOU On Demand
Holdings, Inc., Its Subsidiaries and Variable Interest
Entity
|
|
|
|
|
|
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
ASSETS
|
2014
|
|
2013
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
13,045,215
|
|
$
3,822,889
|
|
Accounts receivable,
net
|
636,684
|
|
175,211
|
|
Licensed content,
current
|
1,000,928
|
|
428,322
|
|
Prepaid
expenses
|
292,708
|
|
330,013
|
|
Debt issuance costs,
net
|
-
|
|
128,879
|
|
Other current
assets
|
9,066
|
|
48,928
|
|
Total current
assets
|
14,984,601
|
|
4,934,242
|
|
|
|
|
|
|
|
Property and
equipment, net
|
376,330
|
|
499,858
|
|
Licensed content,
non-current
|
145,801
|
|
162,646
|
|
Intangible assets,
net
|
2,386,419
|
|
2,621,527
|
|
Goodwill
|
6,105,478
|
|
6,105,478
|
|
Investment in
unconsolidated entities
|
861,194
|
|
673,567
|
|
Other non-current
assets
|
367,409
|
|
-
|
|
Total
assets
|
$
25,227,232
|
|
$
14,997,318
|
|
|
|
|
|
|
|
LIABILITIES,
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
173,613
|
|
656,545
|
|
Deferred
revenue
|
142,144
|
|
68,969
|
|
Accrued expenses and
other liabilities
|
1,745,126
|
|
1,075,944
|
|
Deferred license
fees
|
1,205,427
|
|
1,200,764
|
|
Contingent purchase
price consideration liability
|
-
|
|
578,744
|
|
Convertible promissory
note
|
3,000,000
|
|
3,000,000
|
|
Warrant
liabilities
|
619,660
|
|
1,344,440
|
|
Total current
liabilities
|
6,885,970
|
|
7,925,406
|
|
Deferred income tax
liability
|
41,560
|
|
125,809
|
|
Convertible promissory
note
|
-
|
|
2,000,000
|
|
Total
liabilities
|
6,927,530
|
|
10,051,215
|
|
|
|
|
|
|
Commitments
and contingencies
|
|
|
|
|
|
|
|
|
|
Convertible
redeemable preferred stock:
|
|
|
|
|
Series A - 7,000,000
shares issued and outstanding, liquidation preference of
$3,500,000 at September 30, 2014 and
December 31, 2013, respectively
|
1,261,995
|
|
1,261,995
|
|
Series C – 0 and
87,500 shares issued and outstanding, liquidation preference of
$0 and $350,000 at September
30, 2014 and December 31, 2013, respectively
|
-
|
|
219,754
|
|
Series D 4% - 0 and
2,285,714 shares issued and outstanding,
liquidation preference of $0
and $4,000,000 at September 30, 2014 and December 31,
2013, respectively
|
-
|
|
4,000,000
|
|
Equity:
|
|
|
|
|
Series E Preferred
Stock, $0.001 par value; 16,500,000 shares authorized,
7,559,998 and 0 shares issued and
outstanding, liquidation preference of $13,300,000 and $0 at September 30, 2014 and December
31, 2013, respectively
|
7,560
|
|
-
|
|
Common stock, $0.001
par value; 1,500,000,000 shares authorized, 23,598,430
and 15,794,762 shares issued
at September 30, 2014 and December 31, 2013,
respectively
|
23,598
|
|
15,794
|
|
Additional paid-in
capital
|
112,764,950
|
|
67,417,025
|
|
Accumulated
deficit
|
(92,293,390)
|
|
(65,856,053)
|
|
Accumulated other
comprehensive loss
|
(1,381,701)
|
|
(715,090)
|
|
Total YOU On
Demand equity
|
19,121,017
|
|
861,676
|
|
Non-controlling
interest
|
(2,083,310)
|
|
(1,397,322)
|
|
Total
equity
|
17,037,707
|
|
(535,646)
|
|
Total
liabilities, convertible redeemable preferred stock
and equity
|
$
25,227,232
|
|
$
14,997,318
|
|
|
|
|
|
|
|
SOURCE YOU On Demand Holdings, Inc.