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Chicken Soup For The Soul Entertainment, Inc. (CSSE) SEC Filing 10-K Annual report for the fiscal year ending Sunday, December 31, 2017

Chicken Soup For The Soul Entertainment,

CIK: 1679063 Ticker: CSSE

 

Exhibit 99.1

 

 

 

Chicken Soup for the Soul Entertainment Announces FY 2017 Results

 

Highlights Opportunities with Acquisition of Screen Media; Board Approves $5 Million Share Repurchase Program; Management Reiterates Outlook for 2018

 

Management Conference Call to Be Held at 4:30 P.M. ET Today

 

COS COB, Conn., March 27, 2018 (GLOBE NEWSWIRE) — Chicken Soup for the Soul Entertainment, Inc. (“CSS Entertainment”) (Nasdaq:CSSE), a fast-growing provider of positive and entertaining video content, today announced its financial results for the three and 12-month periods ended December 31, 2017.

 

Full Year 2017 and Subsequent Business Highlights

 

·Completed $30.0 million IPO in August 2017
·Completed acquisition of Screen Media Ventures, LLC (“Screen Media”), substantially transforming the company from primarily production to a top-tier player in the exploding direct-to-consumer entertainment market
·Obtained sponsors for four series: Chicken Soup for the Soul’s Hidden Heroes, Being Dad, Vacation Rental Potential and The New Americans
·Board approved a $5.0 million Share Repurchase Program
·Secured an independent, third-party valuation opinion that the newly acquired assets from Screen Media are valued at approximately $31.4 million, with the Popcornflix® direct-to-consumer online video service and associated content rights and the Screen Media TV and film library assets
·As a result of this valuation, the Company recognized a non-recurring gain on bargain purchase of $24.1 million, recorded in the fourth quarter of 2017
·Expanded management team by promoting Elana Sofko to the new position of chief operating officer, naming Susan Kravitz as executive vice president of sales and strategic sponsorships, and appointing Lou Occhicone as its senior vice president of business affairs and distribution
·Agreed to a commercial credit proposal from a bank for $7.5 million consisting of a 5-year $5.0 million term loan and a 3-year $2.5 million revolving credit facility which is expected to close shortly
·Reiterated 2018 outlook of approximately $36.0 million in revenue and $18.0 million in Adjusted EBITDA

 

William J. Rouhana, Jr., chairman and chief executive officer, stated “The milestone acquisition of Screen Media in November has meaningfully enhanced our trajectory and mitigated the risk to our business. This single transaction provides us with a significant asset base independently appraised at more than $31.0 million in the form of a library of more than 1,200 television series and feature films and Popcornflix: five additional ad-supported video-on-demand, or VOD, networks with more than 15 million active users and rights to an additional 1,800 movies and 1,500 TV episodes. With a purchase price of only 1X EBITDA, we effectively created more than twice as much shareholder value based on Adjusted EBITDA as we expected to create from operations for 2017. Our goal has always been to develop, launch and grow online VOD networks that are both advertising-supported and subscription-based. Our historical production activity has always been designed to subsidize this effort by producing original content and generating revenue and profits. Now, we have two of our lines of business, Production and Distribution, that generate revenue and profits, both of which subsidize our third line of business, the VOD business.”

 

Rouhana continued, “We have already increased the value of the Screen Media assets and continue to see opportunities for additional growth. In the first two months of 2018, Screen Media’s revenue is up 67% on a stand-alone basis compared to its revenue in the first two months last year, and Screen Media’s Adjusted EBITDA increased 96% during the same period year-over-year. In addition, the advertising rates we charge for Popcornflix are up over 10% compared to this time last year, before the addition of analytics and the impact of direct sales efforts. Additionally, app downloads since January 1, 2018 have exceeded 3.8 million, which is more app installs than in all of 2017.”

 

“We are reiterating our full-year 2018 outlook of $36.0 million in revenue and $18.0 million in Adjusted EBITDA,” said Scott W. Seaton, Vice Chairman. “In addition, we expect to generate between $5.5 million and $6.2 million in revenue, and $1.5 million to $2.0 million in Adjusted EBITDA, in the first quarter of 2018 compared to $1.4 million of revenue and $670,000 of Adjusted EBITDA in the same quarter last year. While the Screen Media acquisition has significantly reduced the percentage of overall annual revenue generated in the fourth quarter, we still expect the fourth quarter to represent our highest revenue quarter in 2018. A portion of our anticipated first quarter results are related to revenue that was expected to be recognized in the fourth quarter of 2017 but shifted into early 2018 as we focused on Screen Media’s integration and laying the groundwork for 2018. The balance is due to strong performance by each of our three revenue areas: online networks, distribution and production. We expect to generate approximately $1 million in revenue from our online networks in the first quarter, up from just over $150,000 in the first quarter last year. Production revenue will increase by more than 50% year-over-year, and we have added distribution as a new revenue area.”

 

Q4 2017 Financial Summary

 

Net income for the three months ended December 31, 2017 was $24.1 million compared to $1.6 million for the year-ago period.

 

Total revenue for the three months ended December 31, 2017 was $8.7 million, up 53% compared to $5.7 million for the year-ago period. The increase was primarily driven by the acquisition of Screen Media in November 2017. Revenue was generated as follows:

 

·Online networks, which include A Plus and Popcornflix, generated $570,000 in revenue in the fourth quarter of 2017 compared to $398,000 in the fourth quarter last year.
·Television and film distribution generated $2.9 million in the fourth quarter.
·Television and short-form video production generated $5.2 million in the fourth quarter, compared to $5.3 million in the fourth quarter last year.

 

Gross profit for the three months ended December 31, 2017 was $5.8 million, or 66% of total revenue, compared to $3.6 million, or 64% of total revenue, for the year-ago period.

 

Operating income for the three months ended December 31, 2017 was $3.3 million compared to $2.9 million for the year-ago period.

 


The following information was filed by Chicken Soup For The Soul Entertainment, Inc. (CSSE) on Wednesday, March 28, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Condensed Consolidated Statements Of Cash Flows
Consolidated Balance Sheets
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Consolidated Statements Of Income And Comprehensive Income
Consolidated Statements Of Income And Comprehensive Income (parenthetical)
Consolidated Statements Of Stockholders' Equity/members' Deficit
Consolidated Statements Of Stockholders' Equity/members' Deficit (parenthetical)
Business Combination
Business Combination (details 1)
Business Combination (details Textual)
Business Combination (details)
Business Combination (tables)
Commitments And Contingencies
Commitments And Contingencies (details Textual)
Commitments And Contingencies (details)
Commitments And Contingencies (tables)
Earnings Per Share
Earnings Per Share (details)
Earnings Per Share (tables)
Episodic Television Programs
Film Library
Film Library (details)
Film Library (tables)
Income Taxes
Income Taxes (details 1)
Income Taxes (details 1) (parenthetical)
Income Taxes (details 2)
Income Taxes (details Textual)
Income Taxes (details)
Income Taxes (tables)
Intangible Asset - Video Content License
Intangible Asset - Video Content License (details Textual)
Programming Costs
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Stockholders' Equity (details Textual)
Stockholders??? Equity
Subsequent Events
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Summary Of Significant Accounting Policies
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The Company, Description Of Business, Initial Public Offering And Acquisition
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Chicken Soup For The Soul Entertainment, Inc. provided additional information to their SEC Filing as exhibits

Ticker: CSSE
CIK: 1679063
Form Type: 10-K Annual Report
Accession Number: 0001144204-18-018323
Submitted to the SEC: Fri Mar 30 2018 5:19:23 PM EST
Accepted by the SEC: Fri Mar 30 2018
Period: Sunday, December 31, 2017
Industry: Allied To Motion Picture Production

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