NEW
YORK and SHANGHAI,
Dec. 19,
2023 /PRNewswire/ -- MultiMetaVerse Holdings Limited
("MMV" or the "Company", collectively with its subsidiaries and
consolidated variable interest entities, the "Group") (NASDAQ:
MMV), an animation and entertainment company for young consumers in
China, today announced its
unaudited 2023 half year financial results.
2023 Half Year Highlights:
- Business combination among Model Performance Acquisition
Corp., the Company, Model Performance Mini Sub Corp. and
MultiMetaVerse Inc. (the "Business Combination"), pursuant to the
terms of the merger agreement dated as of August 6, 2021, was consummated on January 4, 2023.
- Total net revenues were US$5.5
million, representing a decrease of 31% compared to that of
the same period in 2022.
- Net loss attributable to shareholders of the Company was
US$23.8 million, compared to
US$4.8 million for the same period in
2022.
- Adjusted EBITDA was negative US$4.2 million, compared to negative US$1.8 million of net adjusted EBITDA for the
same period in 2022.
"Affected by the overall decrease of consumer demand in
China in the industry, and in
particular, the spending of young consumers making up the majority
of our fan base, we have seen a decrease in net revenues and a
larger loss from operations." said Mr. Yiran Xu, chairman and chief executive officer
of the Company. "Despite of this, we delivered remarkable animation
and entertainment contents to the market. We launched a major game
update, titled Project A, which secured 1.6 million new users up to
June 2023 with limited marketing
expenses, and earned a rating of 4.8 out of 5.0 on iOS app store.
We completed the production of a new series, Aotu Academy Season 3,
in this period which earned a rating of 9.4 out of 10.0 on Bilibili
when subsequently published in September
2023. With various quality contents distributed, our fan
base and social media followers continue to grow; the number of
followers on the top two short video platforms in China, namely Douyin and Kuaishou, increased
from 5.3 million to 5.8 million in the first half of 2023. In
addition, we experienced revenue growth in other business segments
of our operation, such as game cinematic animation production
services and brand licensing. To manage the Company's operating
loss, we also have streamlined our work force for efficiency, and
we believe we will realize these economic benefits in the second
half of the year."
2023 Half Year Financial Results
Total net revenues. Total net revenues were US$5.5 million, representing a decrease of 31%
compared to that of the same period in 2022.
Mobile games. Revenue from mobile games was US$2.1 million, representing an increase of 40%
compared to that of the same period in 2022. The increase was
mainly attributed to the launch of Project A in February 2023.
Merchandise. Revenue from merchandise sales was
US$1.4 million, representing a
decrease of 41% from the same period in 2022 due to a generally
weaker consumer market in China
during this period.
Animation production services. Revenue from rendering of
animation production services was US$1.3
million, representing a decrease of 49% from the same period
of 2022, mainly due to less animation series produced during the
first half of 2023. On the other hand, game cinematic animation
revenue was more than tripled in the first half of 2023 compared to
that of the same period in 2022, increasing from US$0.2 million to US$0.7
million, as a result of larger customer base.
Licensing. Revenue from licensing was US$0.7 million, representing a decrease of 48%
from the same period in 2022, primarily due to a decrease in
revenues from certain one-off broadcast license related to its
original new animation products. The decrease was partially offset
by the increase of brand license business, which increased from
US$0.2 million in the first half of
2022 to US$0.5 million in the same
period in 2023, primarily attributable to additional cooperation
accomplished with a number of virtual entertainment service
providers.
Cost of revenues. Cost of revenues was US$3.1 million, representing a decrease of 26%
from the same period in 2022. The decrease was mainly due to lower
inventory costs and animation production costs, which were
generally in line with the decrease in revenue.
Gross profit. Gross profit decreased to US$2.4 million for the first half in 2023 from
US$3.7 million for the same period in
2022. Gross margin slightly decreased to 43.3% in the first half of
2023 compared to 46.5% in the same period in 2022, due to the
decline of the high gross margin licensing business.
Total operating expenses. Total operating expenses were
US$25.9 million, which was more than
tripled compared to that of the same period in 2022.
Selling expenses. Selling expenses were US$1.1 million, representing a 135% increase
year-over-year. The increase was primarily the marketing and
promotion budget deployed for the launch of Project A, our major
game update.
General and administrative expenses. General and
administrative expenses were US$21.7
million, which increased by approximately 3.8 times compared
to the administrative expenses incurred in the same period in 2022.
The increase was primarily due to the increased share-based
compensation and transaction costs related to the Business
Combination. Upon the consummation of the Business Combination, the
Company fully amortized the remaining share-based compensation
expense of US$15.1 million upon the
consummation of the Business Combination in January 2023, as compared to US$2.3 million amortization charged to general
and administrative expenses during the first half of 2022. In
addition, transaction costs related to the Business Combination
amounted to US$4.0 million compared
to US$0.4 million in the same period
in 2022.
Research and development expenses. Research and
development expenses were US$3.1
million, representing a 10% decrease year-over-year. The
decrease was consistent with the Company's original animation
production pace, as more original contents, mainly Aotu World
Season 4, were produced in the first half of 2022. Research and
development expenses for other projects remained relatively
stable.
Loss from operations. Loss from operations was
US$23.5 million, compared to
US$4.6 million for the same period in
2022.
Other income/(loss), net. Total other loss was
US$0.5 million, representing a 128%
increase compared with that of the same period in 2022. The change
was primarily due to the increase of interest expenses from
US$0.3 million in the first half of
2022 to US$0.6 million in the same
period in 2023, as a result of additional loans and interest
payments due to related parties and third parties.
Net loss. Net loss attributable to MultiMetaVerse
Holdings Limited's shareholders was US$23.8
million, compared to a net loss of US$4.8 million in the same period in 2022.
Adjusted EBITDA. Adjusted EBITDA was negative
US$4.2 million, which was
US$2.4 million higher of the net
adjusted EBITDA of negative US$1.8
million in the same period in 2022. Adjusted EBITDA from
operations is a non-GAAP measure that excludes share-based
compensation expenses, transaction costs, interest expenses, and
depreciation and amortization expense.
Basic and diluted EPS. Basic and diluted net loss per
ordinary share were US$0.72 each,
compared to US$0.16 each in the same
period in 2022.
Cash and cash equivalents. As of June 30, 2023, the Company had cash and cash
equivalents of US$1.8 million.
Liquidity and capital resources. The Group has incurred
losses since its inception. As of June 30,
2023, the Group had an accumulated deficit and a working
capital deficit of US$110.3 million
and US$1.9 million, respectively. In
addition, for the first half of 2023, the Group recorded a net loss
attributable to shareholders and adjusted EBITDA of US$23.8 million and US$4.2
million, respectively. Historically, the Group has relied
principally on both operational sources of cash, equity
contributions from its shareholders, and loans from its
shareholders and other related parties to fund its operations and
business development. In November
2023, the Company has reached a subscription agreement for
the Company's ordinary shares with a third party investor with an
aggregate consideration of US$15
million. In addition to issuance of equity or debt
securities, the Group needs to maintain its operating costs at a
level through strict cost control to ensure operating costs not to
exceed its sources of funds to continue as a going concern for a
period of 12 months after the issuance of its condensed
consolidated financial statements.
There can be no assurance that the Group will be successful in
achieving its cost control and budget goals, that the Group's
future capital raises will be sufficient to support its ongoing
operations, or that any additional financing will be available in a
timely manner or with acceptable terms, if at all. If the Group is
unable to raise sufficient financing or events or circumstances
occur such that the Group does not meet its cost control and budget
goals, it may have a material adverse effect on the Group's
financial position, results of operations, cash flows, and ability
to achieve its intended business objectives.
About MultiMetaVerse Holdings Limited
MultiMetaVerse Holdings Limited (NASDAQ: MMV) is an animation
and entertainment company dedicated to providing a high-quality,
immersive entertainment experience through original,
user-generated, and professional user-generated content. MMV
commenced animation production in 2015 under its signature Aotu
World brand, which has attracted a broad following with its
inspiring storyline and unique graphic style, particularly among
younger audiences in China. By
leveraging the company's established user base, MMV has built a
diverse product portfolio, including animated content, comic books,
short videos, collectibles, stationery, consumer products, and
mobile games across the Aotu World brand. It has also developed and
augmented new brands, stories, and characters, such as Neko
Album.
For more information, please visit
https://www.multi-metaverse.com/.
Use of Non-GAAP Financial Measures
The Company uses adjusted net loss and adjusted EBITDA, which
are non-GAAP financial measures, in evaluating its financial
results and for financial and operational decision-making purposes.
Adjusted net loss represents net income excluding share-based
compensation expenses, impairment loss and transaction costs, and
such adjustment has no impact on income tax expense.
The Company believes that adjusted net loss and adjusted EBITDA
help identify the underlying trends of its business that could
otherwise be distorted by the effect of certain expenses that the
Company includes in the net loss. The Company believes that
adjusted net loss and adjusted EBITDA provide useful information
about its financial results, enhance the overall understanding of
its past performance and future prospects and allow for greater
visibility with respect to key metrics used by its management in
its financial and operational decision- making.
Adjusted net loss and adjusted EBITDA should not be considered
in isolation or construed as an alternative to net loss or any
other measure of performance or as an indicator of the Company's
operating performance. Investors are encouraged to review the
historical non-GAAP financial measures to the most directly
comparable GAAP measures. Adjusted net loss and adjusted EBITDA
presented here may not be comparable to similarly titled measures
presented by other companies. Other companies may calculate
similarly titled measures differently, limiting their usefulness as
comparative measures to the data of the Company. The Company
encourages investors and others to review its financial information
in its entirety and not rely on a single financial measure.
For more information on the non-GAAP financial measures, please
see the table captioned "Unaudited Reconciliations of GAAP and
Non-GAAP Results."
Safe Harbor Statement
This press release contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements generally are identified by the words
"believe," "project," "expect," "anticipate," "estimate," "intend,"
"strategy," "future," "opportunity," "plan," "may," "should,"
"will," "would," "will be," "will continue," "will likely result,"
and similar expressions. Without limiting the generality of the
foregoing, the forward-looking statements in this press release
include descriptions of the Company's future commercial operations.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future events to
differ materially from the forward-looking statements in this press
release, such as the Company's inability to implement its business
plans, identify and realize additional opportunities, or meet or
exceed its financial projections and changes in the regulatory or
competitive environment in which the Company operates. You should
carefully consider the foregoing factors and the other risks and
uncertainties described in the Company's Annual Report on Form 20-F
and other documents filed or to be filed by the Company with the
SEC from time to time, which could cause actual events and results
to differ materially from those contained in the forward-looking
statements. All information provided herein is as of the date of
this press release, and the Company undertakes no obligation to
update any forward-looking statement, except as required under
applicable law.
For investor and media inquiries, please contact:
MultiMetaVerse Holdings Limited
Investor Relations
E-mail: ir@multi-metaverse.com
MULTIMETAVERSE
HOLDINGS LIMITED
|
|
|
|
Unaudited Condensed
Consolidated Statements of Operations
|
|
(In U.S. dollars,
except for the number of shares, or otherwise noted)
|
|
|
|
|
|
For the six months ended
June 30,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Net revenue
|
|
|
|
|
|
|
|
|
Services
|
|
$
|
4,144,850
|
|
|
$
|
5,627,619
|
|
Products
|
|
|
1,366,514
|
|
|
|
2,322,014
|
|
Total net revenue
|
|
|
5,511,364
|
|
|
|
7,949,633
|
|
Cost of revenue
|
|
|
|
|
|
|
|
|
Services
|
|
|
(2,380,746)
|
|
|
|
(2,977,575)
|
|
Products
|
|
|
(746,714)
|
|
|
|
(1,277,005)
|
|
Total cost of revenue
|
|
|
(3,127,460)
|
|
|
|
(4,254,580)
|
|
Gross profit
|
|
|
2,383,904
|
|
|
|
3,695,053
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
|
(1,107,041)
|
|
|
|
(470,275)
|
|
General and
administrative expenses
|
|
|
(21,686,637)
|
|
|
|
(4,458,951)
|
|
Research and
development expenses
|
|
|
(3,060,104)
|
|
|
|
(3,396,193)
|
|
Total operating expenses
|
|
|
(25,853,782)
|
|
|
|
(8,325,419)
|
|
Loss from operations
|
|
|
(23,469,878)
|
|
|
|
(4,630,366)
|
|
Other income/(loss):
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
580
|
|
|
|
702
|
|
Interest
expense
|
|
|
(595,111)
|
|
|
|
(262,246)
|
|
Foreign currency
exchange gain, net
|
|
|
8,045
|
|
|
|
2,536
|
|
Other income,
net
|
|
|
92,659
|
|
|
|
42,011
|
|
Total other income/(loss)
|
|
|
(493,827)
|
|
|
|
(216,997)
|
|
Loss before income tax expense
|
|
|
(23,963,705)
|
|
|
|
(4,847,363)
|
|
Income tax
expense
|
|
|
-
|
|
|
|
-
|
|
Net loss
|
|
$
|
(23,963,705)
|
|
|
$
|
(4,847,363)
|
|
Net loss attributable
to non-controlling interest
|
|
|
(161,171)
|
|
|
|
(88,652)
|
|
Net loss attributable
to MultiMetaVerse Holdings Limited's shareholders
|
|
|
(23,802,534)
|
|
|
|
(4,758,711)
|
|
Other comprehensive
income/(loss)
|
|
|
|
|
|
|
|
|
Foreign currency
translation gain/(loss), net of nil income taxes
|
|
|
855,918
|
|
|
|
516,767
|
|
Total comprehensive loss
|
|
$
|
(23,107,787)
|
|
|
$
|
(4,330,596)
|
|
Total comprehensive
income/(loss) attributable to non-controlling interest
|
|
|
(19,447)
|
|
|
|
69,534
|
|
Total comprehensive
loss attributable to MultiMetaVerse Holdings Limited's
shareholders
|
|
|
(23,088,340)
|
|
|
|
(4,400,130)
|
|
Loss per ordinary share attributable to
MultiMetaVerse Holdings Limited's
shareholders
|
|
|
|
|
|
|
|
|
Basic and
Diluted*
|
|
|
(0.72)
|
|
|
|
(0.16)
|
|
Weighted average number of ordinary shares
outstanding
|
|
|
|
|
|
|
|
|
Basic and
Diluted*
|
|
|
32,962,468
|
|
|
|
30,000,000
|
|
Unaudited Condensed
Consolidated Balance Sheets
|
|
(In U.S. dollars,
except for the number of shares, or otherwise noted)
|
|
|
|
|
|
As of
|
|
|
|
June 30,
2023
|
|
|
December
31, 2022
|
|
|
|
(Unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,809,910
|
|
|
$
|
625,184
|
|
Accounts receivable,
net
|
|
|
410,530
|
|
|
|
787,480
|
|
Amounts due from
related parties
|
|
|
388,451
|
|
|
|
151,826
|
|
Inventories,
net
|
|
|
629,941
|
|
|
|
820,181
|
|
Prepayments and other
current assets
|
|
|
1,501,589
|
|
|
|
3,135,906
|
|
Total current assets
|
|
$
|
4,740,421
|
|
|
$
|
5,520,577
|
|
Non-current assets:
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
|
|
140,379
|
|
|
|
197,578
|
|
Intangible assets,
net
|
|
|
39,210
|
|
|
|
104,866
|
|
Long-term
investment
|
|
|
460,000
|
|
|
|
460,000
|
|
Right-of-use
assets
|
|
|
260,290
|
|
|
|
645,090
|
|
Total non-current assets
|
|
|
899,879
|
|
|
|
1,407,534
|
|
TOTAL ASSETS
|
|
$
|
5,640,300
|
|
|
$
|
6,928,111
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
$
|
2,589,087
|
|
|
$
|
116,424
|
|
Accounts
payable
|
|
|
1,000,874
|
|
|
|
1,093,465
|
|
Amounts due to related
parties, current portion
|
|
|
604,477
|
|
|
|
483,536
|
|
Deferred revenue,
current portion
|
|
|
164,851
|
|
|
|
194,668
|
|
Operating lease
liabilities, current portion
|
|
|
283,054
|
|
|
|
555,869
|
|
Accrued liabilities and
other current liabilities
|
|
|
2,046,105
|
|
|
|
1,927,414
|
|
Total current liabilities
|
|
|
6,688,448
|
|
|
|
4,371,376
|
|
Non-current liabilities:
|
|
|
|
|
|
|
|
|
Amounts due to related
parties, non-current portion
|
|
|
23,493,287
|
|
|
|
19,401,144
|
|
Deferred revenue,
non-current portion
|
|
|
455,351
|
|
|
|
560,796
|
|
Operating lease
liabilities, non-current portion
|
|
|
71,946
|
|
|
|
-
|
|
Warrant
liability
|
|
|
16,375
|
|
|
|
-
|
|
Total non-current liabilities
|
|
|
24,036,959
|
|
|
|
19,961,940
|
|
TOTAL LIABILITIES
|
|
$
|
30,725,407
|
|
|
$
|
24,333,316
|
|
Shareholders' equity
|
|
|
|
|
|
|
|
|
Class A Ordinary
shares*(no par value; 100,000,000 Class A Ordinary Shares
authorized as of June 30, 2023 and December 31,
2022, respectively; 33,048,914
and 30,000,000 shares issued and outstanding as
of June 30, 2023 and December
31, 2022, respectively)
|
|
$
|
-
|
|
|
$
|
-
|
|
Additional paid-in
capital
|
|
|
89,680,745
|
|
|
|
74,252,860
|
|
Accumulated
deficit
|
|
|
(110,289,827)
|
|
|
|
(86,487,293)
|
|
Accumulated other
comprehensive loss
|
|
|
(2,674,133)
|
|
|
|
(3,365,595)
|
|
MultiMetaVerse Holdings Limited shareholders'
deficit
|
|
|
(23,283,215)
|
|
|
|
(15,600,028)
|
|
Non-controlling
interests
|
|
|
(1,801,892)
|
|
|
|
(1,805,177)
|
|
Total shareholders' deficit
|
|
|
(25,085,107)
|
|
|
|
(17,405,205)
|
|
TOTAL LIABILITIES AND SHAREHOLDERS'
DEFICIT
|
|
$
|
5,640,300
|
|
|
$
|
6,928,111
|
|
Unaudited
Reconciliations of GAAP and Non-GAAP Results
|
|
(In U.S. dollars,
except for the number of shares, or otherwise noted)
|
|
|
|
|
|
For the six months ended
June 30,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Non-GAAP Financial Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(23,963,705)
|
|
|
$
|
(4,847,363)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
|
15,095,968
|
|
|
|
2,264,394
|
|
Transaction
costs
|
|
|
3,956,703
|
|
|
|
352,590
|
|
Adjusted net loss
|
|
$
|
(4,911,034)
|
|
|
$
|
(2,230,379)
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
595,111
|
|
|
|
262,246
|
|
Depreciation and
amortization of property and equipment and intangible
assets
|
|
|
120,626
|
|
|
|
127,821
|
|
Adjusted EBITDA
|
|
$
|
(4,195,297)
|
|
|
$
|
(1,840,312)
|
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content:https://www.prnewswire.com/news-releases/multimetaverse-holdings-limited-announces-2023-unaudited-half-year-financial-results-302019191.html
SOURCE MultiMetaVerse Holdings Limited