Global Entertainment Corporation Announces Fiscal Year 2008 Results
August 29 2008 - 7:05AM
Business Wire
Global Entertainment Corporation (AMEX: GEE) � a company engaged in
sports management, multi-purpose events and entertainment center
and related real estate development, facility and venue management
and marketing, and venue ticketing, today reported a loss of $4.03
million for the fiscal year ended May 31, 2008 comprised of: 1) a
loss from continuing operations of $2.82 million primarily
attributable to legal fees and settlements costs associated with
several litigation issues, and 2) a $1.21 million loss from
discontinued operations related to the company�s divestiture of its
Cragar subsidiary. Revenue of $12.44 million was 51.8% lower than
the $25.81 million of revenues realized for the fiscal year ended
May 31, 2007. This reduction was primarily related to the timing of
project management fees realized from major projects that occurred
in fiscal 2007. The project management fees in fiscal 2007 of
$13.87 million included substantial revenue from the company�s
purchase and subsequent resale of furniture, fixtures and equipment
(FFE) for the arenas then under construction. Only minimal FFE
revenue was realized in fiscal 2008 as project management fees were
only $0.91 million. Also contributing to the decrease in revenue
was a reduction of $0.3 million due to the cancellation of facility
contracts in Ohio. Richard Kozuback, president and chief executive
officer, stated, �Our loss from continuing operations was impacted
by the settlement of several litigation issues and the decrease in
facility service fees from the cancellation of facility contracts
in Ohio. Our ticketing operations were also affected by the
contract cancellation; however, service fees were relatively
unchanged as a result of GetTix�s well-diversified revenue stream.�
Continuing, Mr. Kozuback pointed out that, �Because the timing of
the long-term development projects we work on have substantial
variation, any delays in initiating or completing the projects
reverberate company-wide and affect the revenue streams received by
all our subsidiary companies. This was evident in fiscal 2008 and
will hopefully go in the other direction for fiscal 2009. For
example, in fiscal year 2009 we have the opening of the Town Toyota
Center in Wenatchee, Washington planned for October 2008 for which
Global subsidiary companies will supply exclusive services for up
to 15 years. Encore Facility Management (Encore) will manage the
building operations. Global Entertainment Marketing Systems (GEMS)
will be the licensing and advertising arm handling all sales and
marketing services. Global Entertainment Ticketing (GetTix.Net)
will provide exclusive ticketing services for all events. For
fiscal 2009, we also have underway the previously announced
development projects with the Cities of Allen, Texas (a $50 million
multi-purpose events center), and Independence, Missouri (a $52
million multi-purpose events center). We anticipate that both
facilities will have CHL teams and utilize our full array of
services provided by our multiple subsidiary companies.� Finally,
Mr. Kozuback concluded, �After examining our core strengths in
addition to observing the weakening of the automobile industry and
the slowing demand in the automotive aftermarket business, we
decided to sell the assets of Cragar Industries and take a charge
in the fourth fiscal quarter of approximately $1.0 million, which
is included in our loss from discontinued operations. This
divestiture allows us to fully focus on our primary business of
developing first-class multi-purpose events centers that offer
mid-sized communities the opportunity to enjoy a wide array of
sports and entertainment options.� Visit our web sites:
www.globalentertainment2000.com � � � � www.centralhockeyleague.com
www.coliseums.com www.GetTix.net Global Entertainment Corporation
is an integrated events and entertainment company focused on
mid-size communities that is engaged, through its six wholly owned
subsidiaries, in sports management, multi-purpose events and
entertainment centers and related real estate development, facility
and venue management and marketing and venue ticketing. Global
Properties I, in correlation with arena development projects, works
to maximize value and development potential of new properties.
International Coliseums Company (ICC) serves as project manager for
arena development while Encore Facility Management coordinates
operations for all arena facility scheduling. Global Entertainment
Marketing Systems (GEMS) pursues licensing and marketing
opportunities related to the Company�s sports management and arena
developments and operations. Global Entertainment Ticketing
(GetTix.Net) is a ticketing company for sports and entertainment
venues. The Western Professional Hockey League, Inc., through a
joint operating agreement with the Central Hockey League, is the
operator and franchisor of professional minor league hockey teams
in nine states. Certain statements in this release may be
"forward-looking statements" within the meaning of The Private
Securities Litigation Reform Act of 1995. These forward-looking
statements may include projections of matters that affect revenue,
operating expenses or net earnings; projections of capital
expenditures; projections of growth; hiring plans; plans for future
operations; financing needs or plans; plans relating to the
company's products and services; and assumptions relating to the
foregoing. Forward-looking statements are inherently subject to
risks and uncertainties, some of which cannot be predicted or
quantified. Future events and actual results could differ
materially from those set forth in, contemplated by, or underlying
the forward-looking information. Some of the important factors that
could cause the company's actual results to differ materially from
those projected in forward-looking statements made by the company
include, but are not limited to, the following: intense competition
within the sports and entertainment industries, past and future
acquisitions, expanding operations into new markets, risk of
business interruption, management of rapid growth, need for
additional financing, changing consumer demands, dependence on key
personnel, sales and income tax uncertainty and increasing
marketing, management, occupancy and other administrative costs.
These factors are discussed in greater detail in the company's
Annual Report on Form 10-K for the year ended May 31, 2008, as
filed with the Securities and Exchange Commission. GLOBAL
ENTERTAINMENT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED
BALANCE SHEETS (in thousands) � ASSETS May 31, May 31, 2008 2007
Current Assets: Cash and cash equivalents $ 443 $ 4,252 Accounts
receivable, net 1,111 3,420 Investment in Wenatchee project 34,473
-- Other current assets 2,406 � 1,085 � � Total Current Assets
38,433 8,757 � Other Assets 931 � 3,549 � � Total Assets $ 39,364 �
$ 12,306 � � LIABILITIES AND STOCKHOLDERS' EQUITY � Current
Liabilities: Accounts payable and accrued liabilities $ 8,468 $
4,728 Deferred revenues 24 240 Notes payable � current portion
Liabilities related to assets to be disposed 27,220 233 � -- 318 �
� Total Current Liabilities 35,945 � 5,286 � � Other Liabilities
297 � 66 � � Total Liabilities 36,242 � 5,352 � � Stockholders'
Equity: � Common stock 7 7 Paid-in capital 10,930 10,731 Retained
deficit (7,815 ) (3,784 ) � Total Stockholders' Equity 3,122 �
6,954 � � Total Liabilities and Stockholders' Equity $ 39,364 � $
12,306 � GLOBAL ENTERTAINMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATED SUMMARY OF OPERATIONS (in thousands except share and
per share amounts) � � � For the Years Ended May 31, 2008 � May 31,
2007 Revenue $ 12,437 $ 25,812 Expenses � 15,202 � � 28,874 � Loss
from operations (2,765 ) (3,062 ) Other income (expense) � (159 ) �
461 � Loss from continuing operations before income taxes (2,924 )
� (2,601 � ) Income tax benefit � 105 � - � Loss from continuing
operations (2,819 ) (2,601 ) Loss from discontinued operations, net
of income taxes � (1,212 ) � (1,524 ) Net loss $ (4,031 ) $ (4,125
) � Loss per common share: Diluted Loss from continuing operations
$ (0.43 ) $ (0.40 ) Loss from discontinued operations � (0.19 ) �
(0.23 ) Net loss $ (0.62 ) $ (0.63 ) Weighted average number of
common shares outstanding: Diluted � � 6,545,292 � � � 6,502,736
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