Adjusted EBITDA Improves 17%
Viggle Inc. (Nasdaq:VGGL) reported financial results for its
fiscal first quarter 2016 ended September 30, 2015. Revenue for the
quarter was $5.1 million compared with $6.5 million in the year-ago
first quarter. Adjusted EBITDA loss for the fiscal first quarter
2016 was $6.5 million, compared with a loss of $7.8 million in the
year-ago first quarter, an improvement of 17%. Financial results
for the fiscal first quarter 2016 include DraftDay Gaming Group,
its 49% owned subsidiary that was formed in September 2015.
Adjusted EBITDA improvements for the quarter were driven by
reductions in personnel, marketing and technology costs. Revenue
for the quarter declined primarily because of decreased third-party
advertising on the Viggle App and barter revenue.
Robert F.X. Sillerman, Executive Chairman and Chief Executive
Officer, said, “Much of this quarter was spent identifying new
business ventures and partnerships that can grow our revenue
streams while bringing our expenses to the level where we can seize
those opportunities. One of the attributes of our business model is
that the Viggle platform is conducive to many different ventures
that can contribute to growth and we are enthusiastic about the
great potential that lies ahead for us.”
Key metrics for the fiscal first quarter ended September 30,
2015 were:
- Approximately 265,000 new users
registered on the Viggle platform, bringing net registered users to
more than 9.8 million, compared with 7.0 million net registered
users as of the end of the year-ago first quarter, an increase of
39%.
- Average monthly total reach for F1Q
2016 was 18.6 million, compared with 23.8 million in the year-ago
quarter, a 22% decrease, and 23.6 million for the quarter ended
June 30, 2015.
- Average active reach in the quarter was
9.6 million compared with 10.3 million for F1Q 2015, a decrease of
4%, and compared with 10.2 million in F4Q 2015.
- As of September 30, 2015, Viggle users
have cumulatively checked in to more than 508 million TV programs
and matched more than 192 million songs using the Viggle Music
service. Overall, users’ average time in the Viggle app has been
more than 58 minutes per session.
- As of September 30, 2015, users have
cumulatively redeemed more than 71 billion points for approximately
5.6 million rewards, an average of 12,667 points per reward
redemption. The total retail value of rewards redeemed through
September 30, 2015 is approximately $28.6 million.
About Viggle
Viggle is an entertainment marketing and rewards platform and
fantasy sports provider whose app rewards its members for watching
TV shows, discovering new music and playing interactive games. The
Viggle Platform had an average monthly total reach of 18.6 million
for the three months ended September 30, 2015, including nearly 10
million Viggle registered users. Since its launch, Viggle members
have redeemed nearly $29 million in rewards for watching their
favorite TV programs and listening to music. Members can use
Viggle’s store, accessible through the Viggle app or on Viggle.com,
to redeem their Viggle Points for TV show, movie and music
downloads. In addition, Viggle operates Wetpaint, which offers
entertainment and celebrity news online; NextGuide, maker of
technology that helps consumers search for, find, and set reminders
for TV shows and movies; and Choose Digital, a digital marketplace
platform that allows companies to incorporate digital content into
existing rewards and loyalty programs in support of marketing and
sales initiatives. Viggle is also the largest shareholder of
DraftDay Gaming Group, the third-largest operator in the daily
fantasy sports industry, which offers Viggle members an exciting
and ever-growing selection of real-time fantasy sports games with
monetary rewards. For more information, visit www.viggle.com or
follow us on Twitter @Viggle.
Forward-Looking Statements
This press release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the U.S. Private Securities Litigation
Reform Act of 1995. These forward-looking statements involve
inherent risks and uncertainties that could cause actual results to
differ materially from those projected or anticipated. All
information provided in this press release is as of the date of
this release. Except as required by law, Viggle Inc. undertakes no
obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise, after the date on which the statements are made or to
reflect the occurrence of unanticipated events.
Non-GAAP Adjusted Rewards Costs and Adjusted EBITDA
The Company provides a non-GAAP measure for adjusted rewards
costs as an alternative view of the Company’s cost of providing
rewards to its users. The Company reports rewards costs in its
Consolidated Statement of Operations in both cost of watchpoints
and engagement points and in selling, general and administrative
expenses. Management believes that a useful financial measure for
investors is to provide to them the amount of cash the Company has
actually paid to provide rewards to its users. Therefore, the
Company adjusts cost of watchpoints and engagement points as
reported, which represents the cost of points earned by users
during the period, to the cost of actual rewards redeemed by users
during the period. Selling, general and administrative expenses as
reported are likewise adjusted as certain point costs are
classified as marketing. The Company also presents Adjusted EBITDA.
Adjusted EBITDA is a non-GAAP measure that represents operating
loss (as reported) plus depreciation and amortization, stock based
compensation and adjustment to rewards costs. Management believes
these non-GAAP measures enhance investors’ understanding of the
Company’s financial performance. The information on adjusted
rewards costs and Adjusted EBITDA should be considered in addition
to, but not in lieu of operating loss prepared in accordance with
generally accepted accounting principles in the United States
(GAAP). Since adjusted reward costs and Adjusted EBITDA are not
measures determined in accordance with GAAP, they have no
standardized meaning prescribed by GAAP and therefore, may not be
comparable to the calculation of similar measures of other
companies. A reconciliation between GAAP financial measures and
non-GAAP financial measures is as follows.
Tables Follow
Reconciliation of rewards cost to adjusted rewards cost and
selling, general and administrative expenses to adjusted selling,
general and administrative expenses (amounts in thousands)
Quarter Ended September 30, 2015 Quarter Ended September 30, 2014
4th Quarter Ended June 30, 2015 Cost of watchpoints and engagement
points as reported $(2,022) $(1,164) $(2,626) Adjustment to cost of
watchpoints and engagement points (256) 281 358 Adjusted cost of
watchpoints and engagement points (2,278) (883) (2,268)
Selling, general and administrative expenses as reported (15,566)
(22,771) (19,989) Adjustment to selling, general and administrative
expenses (29) 31
2,328
Adjusted selling, general and administrative expenses
$(15,595)
$(22,740) $(17,661)
Reconciliation of operating
loss to Adjusted EBITDA (amounts in thousands) Quarter Ended
September 30, 2015 Quarter Ended September 30, 2014 Quarter Ended
June 30, 2015 Revenue $5,052 $6,476 $6,899 Operating loss as
reported $(12,536) $(17,459) $(15,716) Add: Stock compensation
costs 5,164 7,562 5,345 Adjustment to cost of watchpoints and
engagement points (256) 281 358 Adjustment to Selling, general and
administrative expenses (29) 31
2,328
Depreciation and amortization costs 1,196 1,800 1,482 Adjusted
EBITDA * $(6,461) $(7,785) $(6,203) * Adjusted EBITDA is a non-GAAP
measure, but shown above it represents operating loss plus
depreciation and amortization, stock based compensation, interest
(expense) income, net, certain one-time selling, general and
administrative costs, and adjustment to rewards costs
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For Viggle:Investors:Tom McLean, 212-231-0092General
CounselorRobert Haag, 1-866-976-4784Managing Partner, IRTH
CommunicationsVGGL@irthcommunicationsorMedia Relations:Dian Griesel
InternationalLaura Radocaj, 212-825-3210lradocaj@dgicomm.com