Global Entertainment Corporation (OTCBB: GNTP) – an
integrated event and entertainment company, today reported
financial results for the second quarter of its fiscal year 2011,
ended November 30, 2010.
During this period, the company realized a net loss of $0.5
million or $0.07 per share compared to a net gain of $0.03 million
or $0.00 per share for the three-month period ended November 30,
2009.
During the second quarter of the company’s fiscal 2011 total
revenues produced were $1.9 million, which was a decline from the
$3.3 million earned during the prior year’s quarter. The major
factors contributing to the drop in revenues were lessening project
management fees and facility management fees. Project management
fees for the quarter were $0.2 million compared to $0.5 million in
the prior year period, a decrease of $0.3 million related to the
completion of projects in Allen, Texas, and Independence, Missouri,
in November 2009. Project management fees during the second quarter
originated from the facility under construction in Dodge City,
Kansas. Facility management fees during the most recent quarter
were $0.5 million versus $1.5 million in the second quarter of
fiscal 2010, a drop of $1 million. This decrease is related to
reduced fees for preopening services on the completed buildings in
Allen, Texas, and Independence, Missouri, and is offset by facility
management fees in those same projects as well as preopening fees
for the Dodge, Kansas, facility.
The Central Hockey League was a bright spot for the company
during the quarter as it produced increased license fees. License
fees – league dues and other rose slightly during the quarter. In
addition, license fees – initial and transfer generated $0.3
million during the second quarter of fiscal 2011 while there were
no license fees – initial and transfer earned during the previous
year’s second quarter.
Total operating costs declined year-over-year. The company had
total operating costs of $2.1 million during the second quarter
versus $3.3 million in the prior year’s second quarter, a drop of
$1.2 million. Cost of revenues fell to $0.9 million for the
quarter, down from $1.9 million in the second quarter of fiscal
2010. General and administrative costs also declined, moving to
$1.2 million from $1.4 million in the same period the previous
year.
Richard Kozuback, President and Chief Executive Officer, stated,
“The economy continues to present challenges for us. However, we
have reduced operating costs and eliminated business units that
have not been profitable for us. Also, we will develop strategic
alliances with synergistic business partners with experience and
expertise in facility management that will allow us to continue to
focus on our core competencies and increasing internal efficiencies
as we strive to position Global Entertainment for future
growth.”
Kozuback added, “We are pleased with the performance of the
Central Hockey League and International Coliseums Company, and we
project improvements in other areas of our business in 2011,
specifically, Global Entertainment Ticketing (GetTix.net). In
addition, we look forward to the completion of the United Wireless
Arena in Dodge City, Kansas, in February, which will mark the
successful completion of the tenth event center project for our
company since 2003.”
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 seven 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
develop potential new properties. International Coliseums Company,
Inc. (ICC) serves as project manager for arena development while
Encore Facility Management and GEC Food Service, LLC coordinate
arena operations and concessions. 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: limited liquidity and the need for
additional financing, intense competition within the sports and
entertainment industries, past and future acquisitions, expanding
operations into new markets, risk of business interruption,
changing consumer demands, dependence on key personnel, sales and
income tax uncertainty and increasing marketing, management,
occupancy and other administrative costs.
The “audited” consolidated balance sheet contained in this press
release has been derived from, and should be read in conjunction
with, the Company’s May 31, 2010 annual report on Form 10-K. This
press release does not include all disclosures normally required by
accounting principles generally accepted in the United States.
FINANCIAL TABLES FOLLOW:
GLOBAL ENTERTAINMENT CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
As of November 30, 2010 (Unaudited) and
May 31, 2010 (Audited)
(in thousands, except share and per share
amounts)
November 30,
May 31, 2010 2010
ASSETS
(Unaudited)
(Audited)
CURRENT ASSETS: Cash and cash equivalents $ 348 $ 193 Accounts
receivable, net of $0 and $194 allowance at November 30, 2010 and
May 31, 2010 1,105 1,042 Prepaid expenses and other assets
116 257 Total current assets 1,569 1,492
Property and equipment, net 96 107 Accounts receivable 215
215 Goodwill 519 519 Other assets 100 119
Total assets $ 2,499 $ 2,452
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT
LIABILITIES: Accounts payable $ 1,287 $ 739 Accrued liabilities 715
871 Deferred revenues 357 86 Contractual obligation - current
portion 34 41 Notes payable - current portion 552
79 Total current liabilities 2,945 1,816
Deferred income tax liability, net 5 5 Contractual obligation -
long-term portion 18 35 Total
liabilities 2,968 1,856
STOCKHOLDERS' EQUITY (DEFICIT) Global Entertainment Corporation
stockholders' equity:
Preferred stock, $.001 par value;
10,000,000 shares authorized; no shares issued or outstanding
- -
Common stock, $.001 par value; 50,000,000
shares authorized; 6,646,062 shares issued and outstanding as of
November 30, 2010 and as of May 31, 2010
7 7 Additional paid-in capital 10,992 10,987 Accumulated deficit
(11,449 ) (10,410 ) Total stockholders' equity
controlling interest (450 ) 584 Noncontrolling interests (19
) 12 Total Stockholders' Equity (Deficit) (469
) 596
Total Liabilities and Stockholders' Equity
(Deficit)
$ 2,499 $ 2,452
GLOBAL ENTERTAINMENT CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
For the Three and Six Months Ended
November 30, 2010 and 2009 (Unaudited)
(in thousands, except share and per share
amounts)
For the Three Months Ended For the Six
Months Ended November 30, November 30, 2010 2009 2010 2009
REVENUES Project development fees $ - $ 102 $ - $ 152
Project management fees 177 533 388 979 Facility management fees
452 1,534 1,267 2,438 Ticket service fees 260 314 383 513 Food
service revenue 151 252 271 324 Advertising sales commissions 54
120 122 191 License fees - league dues and other 531 474 757 848
License fees - initial and transfer 250 — 250 100 Other revenue
16 5 277 159
Total revenues 1,891 3,334
3,715 5,704
OPERATING COSTS AND
EXPENSES Cost of revenues 908 1,943 2,034 3,079 General and
administrative costs 1,198 1,363
2,434 2,827 Total operating costs and expenses
2,106 3,306 4,468
5,906
Operating Income (Loss) (215 ) 28
(753 ) (202 )
OTHER INCOME (EXPENSE)
Interest income 1 - 1 1 Interest expense (23 ) - (27 ) (5 ) Loss on
investment in PVEC, LLC (227 ) (2 ) (279 )
- Total other expense (249 ) (2 )
(305 ) (4 )
Income (Loss) from Operations, before
tax (464 ) 26 (1,058 ) (206 )
Income Tax Benefit
- - - -
Net
Income (Loss) (464 ) 26 (1,058 ) (206 )
Net Income (Loss),
attributable to noncontrolling interest 9
- (19 ) 17
Net Income (Loss),
attributable to Global $ (473 ) $ 26 $ (1,039 ) $ (223 )
Earnings (Loss) Per Share - basic and diluted: Net
income (loss), attributable to Global common shareholders $ (0.07 )
$ 0.00 $ (0.16 ) $ (0.03 )
Weighted Average Number of Shares
Outstanding - basic and diluted
6,646,062 6,639,150 6,646,062
6,636,115