Allied Gaming & Entertainment Provides Updates Ahead of 2nd Quarter 2024 Earnings Release
Allied Gaming & Entertainment (NASDAQ: AGAE) has provided updates ahead of its Q2 2024 earnings release. The company is facing a takeover attempt by Knighted Pastures , led by Roy Choi, without a control premium offer. Knighted has nominated three individuals to AGAE's Board and is attempting to remove three additional directors. AGAE views these actions as detrimental to stockholders' interests. The company will record a one-time pre-tax expense of approximately $3 million in Q2 2024 due to litigation costs, negatively impacting net income and EPS. CEO Yinghua Chen emphasized the company's commitment to cautious and strategic deployment of its cash balance to improve financial performance and enhance shareholder value.
Allied Gaming & Entertainment (NASDAQ: AGAE) ha fornito aggiornamenti in vista della pubblicazione dei risultati del Q2 2024. L'azienda sta affrontando un tentativo di acquisizione da parte di Knighted Pastures, guidato da Roy Choi, senza un'offerta di premio di controllo. Knighted ha nominato tre individui per il Consiglio di AGAE e sta tentando di rimuovere altri tre direttori. AGAE considera queste azioni dannose per gli interessi degli azionisti. L'azienda registrerà un costo non ricorrente ante-imposte di circa 3 milioni di dollari nel Q2 2024 a causa dei costi legali, con conseguenze negative sul reddito netto e sull'EPS. Il CEO Yinghua Chen ha sottolineato l'impegno dell'azienda a un uso cauto e strategico della sua liquidità per migliorare le performance finanziarie e aumentare il valore per gli azionisti.
Allied Gaming & Entertainment (NASDAQ: AGAE) ha proporcionado actualizaciones antes de su informe de ganancias del segundo trimestre de 2024. La compañía está enfrentando un intento de adquisición por parte de Knighted Pastures, liderado por Roy Choi, sin una oferta de prima de control. Knighted ha nominado a tres individuos para la Junta de AGAE y está intentando remover a tres directores adicionales. AGAE considera estas acciones perjudiciales para los intereses de los accionistas. La empresa registrará un gasto no recurrente antes de impuestos de aproximadamente 3 millones de dólares en el segundo trimestre de 2024 debido a costos de litigios, lo que afectará negativamente los ingresos netos y las ganancias por acción (EPS). El CEO Yinghua Chen enfatizó el compromiso de la empresa con un uso cauteloso y estratégico de su saldo de efectivo para mejorar el desempeño financiero y aumentar el valor para los accionistas.
Allied Gaming & Entertainment (NASDAQ: AGAE)는 2024년 2분기 실적 발표를 앞두고 업데이트를 제공했습니다. 이 회사는 Roy Choi가 이끄는 Knighted Pastures의 인수 시도에 직면하고 있으며, 통제 프리미엄 제안은 없습니다. Knighted는 AGAE 이사회에 세 명의 인사를 지명했으며, 추가로 세 명의 이사를 제거하려고 하고 있습니다. AGAE는 이러한 조치를 주주 이익에 해로운 것으로 보고 있습니다. 회사는 법적 비용으로 인해 2024년 2분기 동안 약 300만 달러의 일회성 세전 비용을 기록할 예정이며, 이는 순익 및 주당순이익(EPS)에 부정적인 영향을 미칠 것입니다. CEO Yinghua Chen은 재정 성과를 개선하고 주주 가치를 높이기 위해 현금 잔액을 신중하고 전략적으로 배치하겠다는 회사의 의지를 강조했습니다.
Allied Gaming & Entertainment (NASDAQ: AGAE) a fourni des mises à jour avant la publication de ses résultats pour le 2e trimestre 2024. L'entreprise fait face à une tentative de rachat par Knighted Pastures, dirigée par Roy Choi, sans offre de prime de contrôle. Knighted a nommé trois individus au conseil d'AGAE et essaie de faire sortir trois autres directeurs. AGAE considère ces actions comme nuisibles aux intérêts des actionnaires. La société enregistrera un frais exceptionnel avant impôts d'environ 3 millions de dollars au 2e trimestre 2024 en raison des frais de contentieux, ce qui aura un impact négatif sur le revenu net et le BPA. Le PDG Yinghua Chen a souligné l'engagement de l'entreprise à utiliser prudemment et stratégiquement son solde de liquidités pour améliorer sa performance financière et accroître la valeur pour les actionnaires.
Allied Gaming & Entertainment (NASDAQ: AGAE) hat Updates vor der Bekanntgabe der Ergebnisse für das 2. Quartal 2024 bereitgestellt. Das Unternehmen sieht sich einem Übernahmeversuch durch Knighted Pastures, geleitet von Roy Choi, gegenüber, ohne eine Kontrollprämienofferte. Knighted hat drei Personen für den Vorstand von AGAE nominiert und versucht, drei weitere Direktoren abzusetzen. AGAE betrachtet diese Maßnahmen als nachteilig für die Interessen der Aktionäre. Das Unternehmen wird im 2. Quartal 2024 einen einmaligen, vorsteuerlichen Aufwand von etwa 3 Millionen US-Dollar aufgrund von Rechtskosten verbuchen, was sich negativ auf den Nettogewinn und das EPS auswirken wird. CEO Yinghua Chen betonte das Engagement des Unternehmens für eine vorsichtige und strategische Nutzung seines Bargeldbestands zur Verbesserung der finanziellen Leistung und zur Steigerung des Shareholder-Values.
- Significant cash balance available for strategic deployment
- Management's commitment to grow the company and maximize shareholder value
- One-time pre-tax expense of $3 million in Q2 2024 due to litigation costs
- Negative impact on net income and EPS expected in Q2 2024
- Ongoing takeover attempt by Knighted Pastures
- Increased vulnerability to takeover due to large cash balance
Insights
The $3 million pre-tax expense for Q2 2024 due to litigation costs is a significant financial hit for AGAE. This unexpected expense will likely lead to a substantial decrease in net income and EPS for the quarter. The company's vulnerable position, with a significant cash balance, makes it an attractive target for takeover attempts. This situation could lead to increased volatility in the stock price.
Investors should be cautious about the ongoing dispute with Knighted Pastures , as it may lead to further expenses and potential changes in company leadership. The lack of constructive engagement between Knighted and AGAE's Board is concerning and could result in a prolonged, costly battle for control. This uncertainty may negatively impact investor sentiment and the company's ability to execute its strategic initiatives effectively.
The attempted board takeover by Knighted Pastures without paying a control premium raises significant corporate governance concerns. Their strategy of nominating new directors and attempting to remove existing ones 'for cause' appears aggressive and potentially disruptive to AGAE's operations. The ongoing litigation further complicates the situation, creating additional legal risks and financial burdens for the company.
Shareholders should closely monitor the upcoming 2024 Annual Meeting, as its outcome could significantly impact AGAE's future direction. The legal battle may also lead to increased scrutiny from regulatory bodies, potentially affecting the company's compliance costs and reputation in the market. This situation underscores the importance of robust corporate governance structures in protecting shareholder interests during attempted takeovers.
The ongoing dispute with Knighted Pastures could significantly impact AGAE's market position and investor perception. The company's substantial cash balance, while attractive for strategic growth, has made it vulnerable to takeover attempts. This situation may lead to increased market speculation and volatility in AGAE's stock price.
Investors should consider the potential outcomes of this power struggle, including possible changes in leadership and strategy. The
- Knighted Pastures LLC (“Knighted”), led by Roy Choi, is attempting to acquire control of AGAE without paying a control premium or constructively engaging with AGAE’s Board of Directors. Specifically, Knighted has nominated three individuals to AGAE’s Board for election at the Company’s 2024 Annual Meeting of Stockholders and is also purporting to attempt to remove for cause an additional three directors at the annual meeting, which the Company views as entirely without merit and detrimental to the interest of our stockholders. To further undermine the Company, Knighted has also undertaken litigation that AGAE has been forced to respond to, thereby causing the Company to incur significant and unnecessary costs that negatively impacted the Company’s financial performance.
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As a result of Knighted’s harmful actions, AGAE will record a one-time pre-tax expense of approximately
$3 million
“AGAE is in a unique position with a cash balance that should be deployed cautiously and strategically to improve financial performance and enhance shareholder value, but unfortunately it is also vulnerable to a takeover attempt given this cash balance. While facing an activist shareholder who has refused to engage with the Board and the Company has been disappointing, rest assured that our board and management team remain even more committed to grow the Company and maximize shareholder value and we have full confidence in our strategic initiatives moving forward,” said Yinghua Chen, Chief Executive Officer of AGAE.
Allied Gaming & Entertainment plans to report its second quarter 2024 results soon and will announce the date of the Company’s earnings conference call ahead of the event.
About Allied Gaming & Entertainment
Allied Gaming & Entertainment Inc. (Nasdaq: AGAE) is a global experiential entertainment company focused on providing a growing world of gamers and concertgoers with unique experiences through renowned assets, products and services. For more information, visit alliedgaming.gg.
Forward Looking Statements
This communication contains certain forward-looking statements under federal securities laws. Forward-looking statements may include our statements regarding our goals, beliefs, strategies, objectives, plans, including product and service developments, future financial conditions, results or projections or current expectations. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “intend” or “continue,” the negative of such terms, or other comparable terminology. These statements are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results to be materially different from those contemplated by the forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside our control, that could cause actual results or outcomes to differ materially from those discussed in these forward-looking statements. The inclusion of such information should not be regarded as a representation by the Company, or any person, that the objectives of the Company will be achieved. Important factors, among others, that may affect actual results or outcomes include: risks associated with the future direction or governance of the Company; our ability to execute on our strategic and business plans; the substantial uncertainties inherent in the acceptance of existing and future products and services; the ability to retain key personnel; potential litigation; general economic and market conditions impacting demand for our services; our inability to enter into one or more future acquisition or strategic transactions; and our ability, or a decision not to pursue strategic options for the esports business. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. The business and operations of AGAE are subject to substantial risks, which increase the uncertainty inherent in the forward-looking statements contained in this communication. Except as required by law, we undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Further information on potential factors that could affect our business and results is described under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on March 28, 2024, as amended by the Form 10-K/A filed with the SEC on April 29, 2024, as well as subsequent reports we file with the SEC. Readers are also urged to carefully review and consider the various disclosures we made in such Annual Report on Form 10-K and in subsequent reports with the SEC.
Additional Information Regarding the 2024 Annual Meeting of Stockholders and Where to Find It
The Company intends to file a proxy statement and WHITE proxy card with the
Certain Information Regarding Participants
The Company, its directors and certain of its executive officers and employees may be deemed to be participants in connection with the solicitation of proxies from the Company’s stockholders in connection with the matters to be considered at the 2024 Annual Meeting of Stockholders. Information regarding the direct and indirect interests, by security holdings or otherwise, of the Company’s directors and executive officers in the Company is included in Amendment No. 1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 under the heading “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”, filed with the SEC on April 29, 2024, which can be found through the SEC’s website at https://www.sec.gov/Archives/edgar/data/1708341/000092963824001652/a10k.htm#a_004. To the extent that there are changes to the direct or indirect interests of the Company’s securities by directors and executive officers, they will be set forth in SEC filings on Statements of Beneficial Ownership on Forms 3, 4 and 5. More detailed and updated information regarding the identity of these potential participants, and their direct or indirect interests in the Company, by security holdings or otherwise, will be set forth in the proxy statement for the 2024 Annual Meeting of Stockholders and other materials to be filed with the SEC.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240809365957/en/
Investor Contact:
Tyler Drew
Addo Investor Relations
ir@alliedgaming.gg
Source: Allied Gaming & Entertainment, Inc.
FAQ
What is the one-time expense AGAE will record in Q2 2024?
How will the $3 million expense affect AGAE's financial performance?
Who is attempting to acquire control of Allied Gaming & Entertainment (AGAE)?
What actions has Knighted Pastures taken regarding AGAE's Board of Directors?
