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HOLLYWOOD MEDIA CORP. REPORTS 2012 FOURTH QUARTER AND YEAR END RESULTS
BOCA RATON, Fla., April 1, 2013 – Hollywood Media Corp. (Nasdaq: HOLL) today reported financial results for the fourth quarter and year ended December 31, 2012.
On a continuing operations basis, which includes the contribution from Tekno Books, the Company’s 100% owned subsidiary under the Intellectual Property division, net revenues for the 2012 fourth quarter were unchanged at $0.2 million compared to $0.2 million in the prior-year period. For the full year 2012, net revenues were $0.6 million versus $1.1 million in 2011.
Income from continuing operations for the 2012 fourth quarter, was $4.8 million, or $0.21 per share, compared to a loss from continuing operations for the 2011 fourth quarter of $0.1 million, or $0.01 per share. The income tax benefit of $3.8 million was fully offset by the income tax expense recognized in the Gain on sale of discontinued operations, net of income taxes. Income from continuing operations for the full year 2012 was $0.9 million, or $0.04 per share, which included a non-cash goodwill impairment charge of $3.6 million in the third quarter of 2012 related to the Company’s Ad Sales Division, $0.4 million of non-cash amortization expense of deferred compensation costs, and $0.1 million depreciation and amortization. This compared to a loss from continuing operations for the full year 2011 of $7.1 million, or $0.29 per share, which included a non-cash goodwill impairment charge of $4.8 million in the third quarter of 2011 related to the Company’s Ad Sales Division. The income tax benefit of $5.3 million was fully offset by the income tax expense recognized in the Gain on sale of discontinued operations, net of income taxes.
Net income, which includes discontinued operations, was $11.8 million, or $0.51 per share, in the 2012 fourth quarter, compared to net income of $0.04 million, or $0.00 per share, in the prior-year period. For the full year 2012, net income, which includes discontinued operations, was $10.4 million, or $0.45 per share, compared to a net loss in 2011 of $6.9 million, or $0.28 per share.
At December 31, 2012, the Company had cash and cash equivalents of $11.4 million and no debt as compared to cash and cash equivalents of $3.7 million and no debt at December 31, 2011.
The increased cash position reflects a $7 million earnout payment in cash received in the 2012 fourth quarter from Key Brand Entertainment Inc. (“Key Brand”) pursuant to the amended purchase agreement related to the completed sale of Hollywood Media’s Broadway Ticketing Business (“Theatre Direct”) to Key Brand. In addition, during the 2012 fourth quarter Key Brand notified Hollywood Media that it achieved the revenue target for the second $7 million earnout under the purchase agreement in Key Brand's fiscal year ended June 30, 2012. Accordingly, this $7 million amount was added to the principal amount of the $8.5 million loan due Hollywood Media by Key Brand. Pursuant to this loan, interest will be payable to Hollywood Media at an increased rate of 13% per annum and principal on such second $7 million earnout amount will be amortized in equal quarterly installments over the period commencing October 5, 2012 and ending on June 30, 2015 which is the new shortened maturity date of the loan. As a result of this second $7 million earnout being added to the loan and a subsequent payment received in the amount of $1.0 million (which included a principal payment of $0.5 million), the principal amount of the loan due Hollywood Media by Key Brand was $15.0 million as of December 31, 2012. A $1.1 million payment was received during the first quarter of 2013 in accordance with the terms of the loan.
The Company purchased 16,600 shares of Hollywood Media’s common stock for $0.1 million during the fourth quarter of 2012 and 510,700 shares of Hollywood Media’s common stock for $0.7 million during the first quarter of 2013.
About Hollywood Media Corp.
Hollywood Media Corp. is comprised primarily of an Ad Sales division, an Intellectual Property division, and various financial assets.
Note on Forward-Looking Statements
Statements in this press release may be “forward-looking statements” within the meaning of federal securities laws. The matters discussed herein that are forward-looking statements are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous potential risks and uncertainties, including, but not limited to, the need to manage our growth, our ability to realize anticipated revenues and cost efficiencies, the impact of potential future dispositions or other strategic transactions by Hollywood Media Corp., our ability to develop and maintain strategic relationships, technology risks, the volatility of our stock price, and other risks and factors described in Hollywood Media Corp.’s filings with the Securities and Exchange Commission including our Form 10-K for 2012. Such forward-looking statements speak only as of the date on which they are made.
The following information was filed by Hollywood Media Corp (HOLL) on Monday, April 1, 2013 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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