Total Quarterly Revenues of $7.2 million
with OTT Channel Streaming Revenues Up 47% and Ad-Supported OTT
Revenues Up 45% Versus Prior Year Quarter
Total Monthly Ad-Supported Viewers Now at
15.2 Million, Up 238% Versus Prior Year
Cinedigm Corp. (NASDAQ: CIDM) today announced its financial
results for the three month period ended September 30, 2020.
Key Financial Results:
- Consolidated revenues were $7.2 million, with OTT Channel
streaming up 47% versus prior year quarter
- Transactional Video-On-Demand (TVOD) and Ad-Based
Video-On-Demand (AVOD) Digital Sales increased 27% year-over-year,
driven by partners such as Amazon, with 78% growth
- Ad-supported streaming revenues increased 44% over first
quarter of this fiscal year and 45% over the prior year quarter
despite COVID-19 impacts on the overall advertising market
- OTT Streaming & Digital and Content Distribution Adjusted
EBITDA for the three month period ending September 30, 2020
increased 3% versus the three month period ending September 30,
2019 and increased by $2.3 million, or 72%, versus the six month
period ending September 30, 2019.
- Total Debt reduced by $20.9 million, or 40%, versus prior year,
including conversion of $15 million of convertible notes to equity
at $1.50 per share
Key Business Highlights During Q2 FY2021 (Quarter ended
September 30, 2020)
- Further strengthened balance sheet with common stock issuance
on July 20, 2020 for gross proceeds of $10.8 million
- Launched hundreds of movies, TV episodes and three streaming
channels on NBCUniversal’s Peacock digital streaming
platform
- Announced partnership with Fantawild, China’s largest
theme park operator and top producer of children’s animation in
Asia, to launch a new global streaming service and distribute
Fantawild’s animated content outside of China
- Announced partnership with Bloody Disgusting, the most
popular media brand in horror, to launch a new horror streaming
network that premiered for the Halloween season
- Announced partnership with TwentyOne14 Media to launch a
new, urban multi-cultural entertainment and lifestyle network
- Partnered with Rad (formerly Littlstar) to
distribute Cinedigm's portfolio of streaming channels. Rad
is the leading provider of streaming content to the gaming
ecosystem, where it reaches over 110 million Sony
PlayStation consoles and hundreds of millions of other
streaming devices including Android TVs, mobile devices, and
many more
- Cinedigm’s device streaming footprint now approaching 900
million global devices
Key Business Highlights Subsequent to Quarter End:
- Revenues from the Company’s ad-supported streaming channels
grew 29% from September to October 2020, setting a new Cinedigm
record. Year-over-year, October revenues were up more than 148%,
also a record
- Cinedigm Networks paid subscriber
count surged 45% to 142,000 in last 6 months
- Flagship streaming channel CONtv
subscribers increased 78% since April 1st
- Reached 15.2 million monthly viewers in October for
year-over-year growth of 238%
- Cinedigm agreed to acquire The Film Detective, a leading
streaming content company for classic film and television
programming. The acquisition will add The Film Detective’s
library, comprised of 3,000 content titles, an estimated 10,000
individual film and TV episodes and two streaming networks (The
Film Detective and Lonestar channels) to Cinedigm’s
expansive portfolio of streaming channels and content
- Launched the popular The Bob Ross Channel on
Viacom’s streaming television service, Pluto TV
- Expanded OTT channel portfolio to 25 channels either launched
or under contract versus nine channels a year ago.
“We made strong progress in this seasonally slow quarter as
streaming revenues continued to accelerate behind additional
channel launches, platform/device expansion and enhanced digital
sales, particularly TVOD,” said Chris McGurk, Cinedigm’s Chairman
and CEO. “With several more channels teed up to launch, a strong
recovery in the advertising market and continued demand by all the
streaming platforms for digital content, we expect this growth to
accelerate into our fiscal third quarter as we drive toward
sustained profitability. We are also particularly pleased about
The Film Detective acquisition, which will add almost 10,000
titles/episodes and 2 streaming channels to our portfolio of
streaming assets. As the streaming business continues to
consolidate, we believe Cinedigm is in a unique position to roll-up
additional profitable and accretive streaming assets like The
Film Detective that can immediately generate significant added
revenue growth and profits from our Matchpoint technology,
distribution muscle, content and OTT infrastructure.”
Gary Loffredo, Chief Operating Officer and General Counsel,
added, “We made great progress this quarter by further
strengthening our balance sheet, adding $10.8 million in cash
through an equity offering and reducing our debt by another $15
million by converting convertible notes to equity at $1.50 per
share. We plan to continue to pursue further opportunities to
reduce the remaining debt on our balance sheet over the remainder
of this year, reducing interest expense and facilitating our drive
to sustained profitability. Based on sales activity to date, we
also expect continued strong results next quarter.”
Fiscal Second Quarter Financial Summary (comparing the three
months ended September 30, 2020 to the three months ended September
30, 2019)
Revenue was $7.2 million, a decrease of 30% compared to $10.2
million in the prior year period, due to the expected decline in
the legacy Cinema Equipment business and the negative impact of
COVID-19 on theatrical revenues and temporary DVD warehousing and
distribution center shutdowns due to the impact of COVID-19. This
was partially offset by growth in OTT / streaming revenues. OTT
AVOD Channel revenues increased 45% versus last year and 44% versus
the prior quarter ending June 30, 2020.
The Company reported a consolidated net loss of $26.6 million
for the second quarter of fiscal year 2021. Excluding the
unrealized change in fair value of our equity investment in
Starrise Media Holdings Limited, the operating net loss was $6.8
million, or $.06 per share, driven in large part by the loss of
theatrical revenues in the legacy Cinema Equipment business due to
COVID-19 impacts.
For the second quarter of fiscal year 2021, consolidated
adjusted EBITDA was negative $1.1 million, compared to $1.4 million
in the year-ago period. This decrease was primarily due to the
expected decline of our legacy Cinema Equipment business and the
negative impact of COVID-19 on theatrical revenues and temporary
DVD warehousing and distribution center shutdowns due to the impact
of COVID-19. Content & Entertainment Adjusted EBITDA of
negative $0.9 million was $2.3 million better than the prior year
to date, a 72% increase.
As of September 30, 2020, the Company had cash and cash
equivalents of $16.5 million compared to $14.3 million as of March
31, 2020, the end of our last fiscal year. We completed an equity
raise with common stock for gross proceeds of $10.8 million during
the quarter.
Total debt was reduced by $20.9 million, or 40%, versus
September 30, 2019, compared to March 31, 2019 total debt was
reduced by $34.5 million or 53%.
Conference Call
Cinedigm will host a conference call to discuss its financial
results at 1:30 pm PT / 4:30 pm ET on November 16, 2020.
To participate in the conference call, please dial (877)
407-9124 or for international callers (201) 689-8584 at least five
minutes prior to the start of the call. No passcode is required. An
audio webcast is available directly at the following link
https://www.webcaster4.com/Webcast/Page/2478/38588 and will also be
accessible at http://investor.cinedigm.com/events.cfm. To listen to
the live webcast, please visit the site prior to the start of the
call-in order to register, download and install any necessary audio
software.
For those unable to participate during the live broadcast, a
replay will be available by dialing (877) 481-4010 (U.S.) or (919)
882-2331 (International) and use passcode: 38588
Adjusted EBITDA is defined by the Company for the periods
presented to be earnings before interest, taxes, depreciation and
amortization, other income, net, goodwill impairment, litigation
related expenses and recoveries, stock-based compensation,
expenses, restructuring, transition and acquisitions expenses, net,
and certain other items. Pursuant to the requirements of Regulation
G, the Company has provided a reconciliation in the tables attached
to this release of loss from continuing operations calculated in
accordance with accounting principles generally accepted in the
United States of America (“GAAP”) to Adjusted EBITDA. Adjusted
EBITDA is not a measurement of financial performance under GAAP and
may not be comparable to other similarly titled measures of other
companies. The Company calculated and communicated Adjusted EBITDA
in the tables because the Company's management believes it is of
importance to investors and lenders by providing additional
information with respect to the performance of its fundamental
business activities. Management presents Adjusted EBITDA because it
believes that Adjusted EBITDA is a useful supplement to net loss as
an indicator of operating performance. Management also believes
that Adjusted EBITDA is an industry-wide financial measure that is
useful both to management and investors when evaluating the
Company's performance and comparing our performance with the
performance of our competitors. Management also uses adjusted
EBITDA for planning purposes, as well as to evaluate the Company's
performance because it believes that adjusted EBITDA more
accurately reflects the Company's results, as it excludes certain
items, such as stock-based compensation charges, that management
believes are not indicative of the Company's operating performance.
The Company believes that Adjusted EBITDA is a performance measure
and not a liquidity measure. Adjusted EBITDA should not be
considered as an alternative to operating or net loss as an
indicator of performance or as an alternative to cash flows from
operating activities as an indicator of cash flows, in each case as
determined in accordance with GAAP, or as a measure of liquidity.
In addition, adjusted EBITDA does not take into account changes in
certain assets and liabilities as well as interest and Adjusted
EBITDA is defined by the Company for the periods presented to be
earnings before interest, taxes, depreciation and amortization,
other income, net, goodwill impairment, litigation related expenses
and recoveries, stock-based compensation, expenses, restructuring,
transition and acquisitions expenses, net, and certain other items.
Pursuant to the requirements of Regulation G, the Company has
provided a reconciliation in the tables attached to this release of
loss from continuing operations calculated in accordance with
accounting principles generally accepted in the United States of
America (“GAAP”) to Adjusted EBITDA. Adjusted EBITDA is not a
measurement of financial performance under GAAP and may not be
comparable to other similarly titled measures of other companies.
The Company calculated and communicated Adjusted EBITDA in the
tables because the Company's management believes it is of
importance to investors and lenders by providing additional
information with respect to the performance of its fundamental
business activities. Management presents Adjusted EBITDA because it
believes that Adjusted EBITDA is a useful supplement to net loss as
an indicator of operating performance. Management also believes
that Adjusted EBITDA is an industry-wide financial measure that is
useful both to management and investors when evaluating the
Company's performance and comparing our performance with the
performance of our competitors. Management also uses adjusted
EBITDA for planning purposes, as well as to evaluate the Company's
performance because it believes that adjusted EBITDA more
accurately reflects the Company's results, as it excludes certain
items, such as stock-based compensation charges, that management
believes are not indicative of the Company's operating performance.
The Company believes that Adjusted EBITDA is a performance measure
and not a liquidity measure. Adjusted EBITDA should not be
considered as an alternative to operating or net loss as an
indicator of performance or as an alternative to cash flows from
operating activities as an indicator of cash flows, in each case as
determined in accordance with GAAP, or as a measure of liquidity.
In addition, adjusted EBITDA does not take into account changes in
certain assets and liabilities as well as interest and income taxes
that can affect cash flows. The Company's calculation of Adjusted
EBITDA may or may not be consistent with the calculation of this
measure by other companies in the same industry. Investors should
not view Adjusted EBITDA as an alternative to the GAAP operating
measure of net income (loss). In addition, Adjusted EBITDA does not
take into account changes in certain assets and liabilities as well
as interest and income taxes that can affect cash flows. Management
does not intend the presentation of these non-GAAP measures to be
considered in isolation or as a substitute for results prepared in
accordance with GAAP. These non-GAAP measures should be read only
in conjunction with the Company's consolidated financial statements
prepared in accordance with GAAP income taxes that can affect cash
flows. The Company's calculation of Adjusted EBITDA may or may not
be consistent with the calculation of this measure by other
companies in the same industry. Investors should not view Adjusted
EBITDA as an alternative to the GAAP operating measure of net
income (loss). In addition, Adjusted EBITDA does not take into
account changes in certain assets and liabilities as well as
interest and income taxes that can affect cash flows. Management
does not intend the presentation of these non-GAAP measures to be
considered in isolation or as a substitute for results prepared in
accordance with GAAP. These non-GAAP measures should be read only
in conjunction with the Company's consolidated financial statements
prepared in accordance with GAAP.
About Cinedigm
Since inception, Cinedigm (NASDAQ: CIDM) has been a leader at
the forefront of the digital transformation of content
distribution. Adapting to the rapidly transforming business needs
of today’s entertainment landscape, Cinedigm remains a
change-centric player focused on providing content, channels and
services to the world’s largest media, technology and retail
companies. Cinedigm’s Content and Networks groups provide original
and aggregated programming, channels and services that entertain
consumers globally across hundreds of millions of devices. For more
information, visit www.cinedigm.com.
Cinedigm uses, and will continue to use, its website, press
releases, SEC filings, and various social media channels, including
Twitter (https://twitter.com/cinedigm), LinkedIn
https://www.linkedin.com/company/cinedigm/), Facebook
(facebook.com/Cinedigm), StockTwits
(https://stocktwits.com/CinedigmCorp) and the Company website
(www.cinedigm.com) as additional means of disclosing public
information to investors, the media and others interested in the
Company. It is possible that certain information that the Company
posts on its website, disseminated in press releases, SEC filings,
and on social media could be deemed to be material information, and
the Company encourages investors, the media and others interested
in the Company to review the business and financial information
that the Company posts on its website, disseminates in press
releases, SEC filings and on the social media channels identified
above, as such information could be deemed to be material
information.
[CIDM-E]
Safe Harbor Statement
Investors and readers are cautioned that certain statements
contained in this document, as well as some statements in periodic
press releases and some oral statements of Cinedigm officials
during presentations about Cinedigm, along with Cinedigm's filings
with the Securities and Exchange Commission, including Cinedigm's
registration statements, quarterly reports on Form 10-Q and annual
report on Form 10-K, are "forward-looking'' statements within the
meaning of the Private Securities Litigation Reform Act of 1995
(the "Act''). Forward-looking statements include statements that
are predictive in nature, which depend upon or refer to future
events or conditions, which include words such as "expects,"
"anticipates,'' "intends,'' "plans,'' "could," "might,"
"believes,'' "seeks," "estimates'' or similar expressions. In
addition, any statements concerning future financial performance
(including future revenues, earnings or growth rates), ongoing
business strategies or prospects, and possible future actions,
which may be provided by Cinedigm's management, are also
forward-looking statements as defined by the Act. Forward-looking
statements are based on current expectations and projections about
future events and are subject to various risks, uncertainties and
assumptions about Cinedigm, its technology, economic and market
factors and the industries in which Cinedigm does business, among
other things. These statements are not guarantees of future
performance and Cinedigm undertakes no specific obligation or
intention to update these statements after the date of this
release.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
CINEDIGM CORP.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except for share
and per share data)
September 30, 2020
March 31, 2020
ASSETS
(Unaudited)
Current assets
Cash and cash equivalents
$
16,503
$
14,294
Accounts receivable, net
23,245
34,785
Inventory, net
242
582
Unbilled revenue
2,228
1,992
Prepaid and other current assets
9,380
9,409
Total current assets
51,598
61,062
Restricted cash
1,000
1,000
Equity investment in Starrise, a related
party, at fair value
14,468
23,433
Property and equipment, net
5,118
7,967
Right-of-use assets
169
1,210
Intangible assets, net
5,743
6,924
Goodwill
8,701
8,701
Other long-term assets
5
143
Total assets
$
86,802
$
110,440
LIABILITIES AND DEFICIT
Current liabilities
Accounts payable and accrued expenses
$
57,265
$
77,085
Current portion of notes payable,
including unamortized debt discount of $— and $460 respectively
16,643
37,249
Current portion of notes payable,
non-recourse including unamortized debt discount of $358 and $763,
respectively
11,749
11,442
Operating lease liabilities
135
593
Current portion of deferred revenue
1,750
1,645
Total current liabilities
87,542
128,014
Notes payable
2,152
—
Operating lease liabilities,
noncurrent
34
684
Deferred revenue, net of current
portion
60
919
Other long-term liabilities
8
110
Total liabilities
89,796
129,727
Stockholders’ deficit
Preferred stock, 15,000,000 shares
authorized; Series A 10% - $0.001 par value per share; 20 shares
authorized; and 7 shares issued and outstanding at September 30,
2020 and March 31, 2020. Liquidation preference of $3,648
3,559
3,559
Common stock, $0.001 par value; Class A
stock 200,000,000 shares authorized at September 30, 2020 and March
31, 2020; 123,041,378 and 63,251,429 shares issued and 121,727,542
and 61,937,593 shares outstanding at September 30, 2020 and March
31, 2020, respectively
122
62
Additional paid-in capital
463,741
400,784
Treasury stock, at cost; 1,313,836 Class A
common shares at September 30, 2020 and March 31, 2020
(11,603
)
(11,603
)
Accumulated deficit
(457,481
)
(410,904
)
Accumulated other comprehensive (loss)
income
(18
)
92
Total stockholders’ deficit of Cinedigm
Corp.
(1,680
)
(18,010
)
Deficit attributable to noncontrolling
interest
(1,314
)
(1,277
)
Total deficit
(2,994
)
(19,287
)
Total liabilities and deficit
$
86,802
$
110,440
CINEDIGM CORP.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except for share
and per share data)
Three Months Ended September
30,
Six Months Ended September
30,
2020
2019
2020
2019
Revenues
$
7,182
$
10,241
$
13,200
$
20,044
Costs and expenses:
Direct operating (excludes depreciation
and amortization shown below)
4,330
4,087
7,009
7,699
Selling, general and administrative
6,168
4,988
10,008
10,837
(Recovery) provision for doubtful
accounts
(193
)
56
(193
)
326
Depreciation and amortization of property
and equipment
1,345
1,609
2,869
3,383
Amortization of intangible assets
591
594
1,181
1,589
Total operating expenses
12,241
11,334
20,874
23,834
Loss from operations
(5,059
)
(1,093
)
(7,674
)
(3,790
)
Interest expense, net
(1,194
)
(1,813
)
(2,484
)
(4,095
)
Loss on extinguishment of notes
payable
(335
)
—
(312
)
—
Changes in fair value of equity investment
in Starrise, a related party
(19,832
)
—
(35,626
)
—
Other expense, net
(327
)
(155
)
(521
)
(168
)
Loss from operations before income
taxes
(26,747
)
(3,061
)
(46,617
)
(8,053
)
Income tax benefit (expense)
181
(27
)
181
(74
)
Net loss
(26,566
)
(3,088
)
(46,436
)
(8,127
)
Net income (loss) attributable to
noncontrolling interest
23
(7
)
37
(1
)
Net loss attributable to controlling
interests
(26,543
)
(3,095
)
(46,399
)
(8,128
)
Preferred stock dividends
(89
)
(89
)
(178
)
(178
)
Net loss attributable to common
stockholders
$
(26,632
)
$
(3,184
)
$
(46,577
)
$
(8,306
)
Net loss per Class A common stock
attributable to common stockholders - basic and diluted:
Net loss attributable to common
stockholders
$
(0.23
)
$
(0.08
)
$
(0.45
)
$
(0.21
)
Weighted average number of Class A common
stock outstanding: basic and diluted
114,532,217
41,439,520
104,529,411
39,903,778
Adjusted EBITDA
Following is the reconciliation of our consolidated net loss to
Adjusted EBITDA:
Three Months Ended September
30,
($ in thousands)
2020
2019
Net loss
$
(26,566
)
$
(3,088
)
Add Back:
Income tax (benefit) expense
(181
)
27
Depreciation and amortization of property
and equipment
1,345
1,609
Amortization of intangible assets
591
589
Loss on extinguishment of notes
payable
335
—
Interest expense, net
1,194
1,818
Changes in fair value on equity investment
in Starrise
19,832
—
Other expense, net
1,291
296
Stock-based compensation and expenses
1,035
178
Net income attributable to noncontrolling
interest
23
(7
)
Adjusted EBITDA
$
(1,101
)
$
1,422
Adjustments related
to the Cinema Equipment Business
Depreciation and amortization of property
and equipment
$
(1,239
)
$
(1,491
)
Amortization of intangible assets
(7
)
(12
)
Loss (income) from operations
1,384
(917
)
Adjusted EBITDA from Content &
Entertainment business and corporate segment
$
(963
)
$
(998
)
Adjusted EBITDA
Following is the reconciliation of our consolidated net loss to
Adjusted EBITDA:
Six Months Ended September
30,
($ in thousands)
2020
2019
Net loss
(46,436
)
(8,127
)
Add Back:
Income tax (benefit) expense
(181
)
74
Depreciation and amortization of property
and equipment
2,869
3,383
Amortization of intangible assets
1,181
1,589
Loss on extinguishment of notes
payable
312
—
Interest expense, net
2,484
4,095
Changes in fair value on equity investment
in Starrise
35,626
—
Other expense, net
1,590
759
Stock-based compensation
1,212
189
Net loss attributable to noncontrolling
interest
37
(1
)
Adjusted EBITDA
$
(1,306
)
$
1,961
Adjustments related
to the Cinema Equipment Business
Depreciation and amortization of property
and equipment
(2,642
)
(3,137
)
Amortization of intangible assets
(15
)
(23
)
Stock-based compensation and expenses
—
7
Income (loss) from operations
3,045
(2,050
)
Adjusted EBITDA from Content &
Entertainment business and corporate segment
$
(918
)
$
(3,242
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201116005992/en/
Jill Newhouse Calcaterra Cinedigm
jcalcaterra@cinedigm.com 310-466-5135
Cinedigm (NASDAQ:CIDM)
Historical Stock Chart
From Mar 2024 to Apr 2024
Cinedigm (NASDAQ:CIDM)
Historical Stock Chart
From Apr 2023 to Apr 2024
