Vinco Ventures, Inc. Reports Financial Results for the Three Months Ended March 31, 2021

Rhea-AI Summary

Vinco Ventures (NASDAQ:BBIG) reported a revenue increase of 31.32% for Q1 2021, totaling $2.57 million, compared to $1.95 million in Q1 2020. Gross profit rose to $0.9 million, though gross margin improved to 35.54%. However, the company suffered a net loss of $62.47 million, or ($3.27) per share, a significant decline from a net gain of $1.27 million in the previous year. Vinco announced a merger plan with ZASH Global Media and a joint venture to form ZVV Media Partners.

Positive

• Revenue increased by 31.32% to $2.57 million.
• Gross margin improved to 35.54%, up from 30.19%.

Negative

• Net loss of $62.47 million, significantly down from a net gain of $1.27 million.
• Adjusted EBITDA worsened to a negative $1.29 million, from negative $0.92 million.

Bethlehem, P.A., May 25, 2021 (GLOBE NEWSWIRE) -- Vinco Ventures, Inc. (NASDAQ:BBIG), a digital media merger and acquisitions company, today announced results for the three months ended March 31, 2021.

Company Highlights

	●	Revenue increased 31.32% for the three months ended March 31, 2021 versus the three months ended March 31, 2020.
	●	Company enters into Agreement to Complete a Plan of Merger with ZASH Global Media and Entertainment Corporation
	●	Company enters into joint venture with ZASH Global Media and Entertainment Corporation forming ZVV Media Partners, LLC

Three Months End March 31, 2021 Financial Summary

Revenue

	●	Revenue for the three months ended March 31, 2021 increased to $2.57 million as compared to $1.95 million for the three months ended March 31, 2020, a 31.32% increase.
	●	Gross Profit for the three months ended March 31, 2021 increased to $0.9 million as compared to $0.6 million for the three months ended March 31, 2020, a 56.64% decrease.
	●	Gross Margin for the three months ended March 31, 2021 increased to 35.54% as compared to 30.19% for the three months ended March 31, 2020, a 17.72% increase.

Net Loss

●

Net loss for the three months ended March 31, 2021 was $62.47 million, or ($3.27) per basic and ($3.28) per diluted share, compared to a net gain of $1.27 million, or $0.166 per basic and $0.13 per diluted share for the three months ended March 31, 2020.

Adjusted EBITDA

	●	Adjusted EBITDA, a non-GAAP measure, totaled a negative $1.29 million for the three months ended March 31, 2021, compared to a negative $0.92 million for the three months ended March 31, 2020.
	●	Adjusted EBITDA includes the addback for the loss on issuance of warrant liability of $75.2 million offset by a gain on change in fair value of warrant liability of $36.4 million.

See below, under the heading “Use of Non-GAAP Financial Information,” for a discussion of Adjusted EBITDA and a reconciliation of such measure to the most comparable measure calculated under U.S. generally accepted accounting principles (“GAAP”).

For the three months ended March 31, 2021 and 2020, EBITDA and Adjusted EBITDA consisted of the following:

		For the Three Months Ended March 31,
		2021				2020
Net income (loss) from continuing operations		$	(62,263,320	)		$	1,269,492
Net income (loss) from discontinued operations			(178,200	)			-
Interest expense, net			12,694,933				723,957
Depreciation and amortization			445,541				316,298
EBITDA			(49,301,046	)			2,309,747
Stock-based compensation			8,697,502				1,319,511
Loss on issuance of warrant liability			75,156,534
Change in fair value of warrant liability			(36,381,542	)			-
Restructuring and severance costs			-				242,136
Transaction and acquisition costs			704,565				82,736
Other non-recurring costs			-				40,860
Gain on divestiture			-				(4,911,760	)
			-				-
Adjusted EBITDA		$	(1,123,987	)		$	(916,770	)

Vinco Ventures, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS

		March 31, 2021				December 31, 2020
		(Unaudited)
Assets
Current assets:
Cash and cash equivalents		$	5,525,744			$	249,356
Accounts receivable, net			1,683,294				1,382,163
Short-term investments			948,000				1,018,000
Inventory			1,123,261				1,127,725
Prepaid expenses and other current assets			603,966				522,259
Current assets of discontinued operations			1,354,546				1,042,680
Total current assets			11,238,811				5,342,183
Property and equipment, net			996,217				1,010,801
Right of use assets, net			128,871				153,034
Loan receivable			5,000,000				-
Equity method investment			7,000,000				-
Intangible assets, net			9,485,370				9,798,813
Goodwill			5,983,852				5,983,852
Non-current assets of discontinued operations			5,640,238				5,739,524
Total assets		$	45,473,359			$	28,028,207
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	1,339,009			$	3,618,339
Accrued expenses and other current liabilities			1,344,750				2,101,610
Deferred revenues			131,578				152,040
Current portion of operating leases liabilities			73,054				96,777
Income tax payable			27,643				27,643
Line of credit, net of debt issuance costs of $0 and $15,573, respectively			1,133,652				1,500,953
Current portion of convertible notes payable, net of debt issuance costs of $9,827,778 and $0, respectively			1,172,222				577,260
Current portion of notes payable, net of debt issuance costs of $0 and $212,848, respectively			441,192				1,301,212
Current portion of notes payable – related parties			876,500				1,389.923
Due to related party			15,450				32,452
Current liabilities of discontinued operations			589,363				487,454
Total current liabilities			7,144,413				11,285,663
Operating leases liabilities –net of current portion			58,713				58,713
Convertible notes payable – related parties, net of current portion, net of debt discount of $172,984 and $366,666, respectively			249,288				1,161,495
Notes payable, net of current portion			450,002				595,879
Notes payable – related parties, net of current portion			1,291,013				1,403,756
Warrant liability			58,235,565				-
Total liabilities		$	67,428,994			$	14,505,506
Commitments and Contingencies (Note 12)
Stockholders’ equity
Preferred stock, $0.001 par value, 30,000,000 shares authorized as of March 31, 2021 and December 31, 2020, respectively			-				-
Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized; 764,618 and 764,618 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively		$	765			$	765
Common stock, $0.001 par value, 250,000,000 shares authorized 25,685,981 and 14,471,403 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively			25,686				14,471
Additional paid-in-capital			66,002,229				39,050,260
Accumulated deficit			(86,118,452	)			(23,648,898	)
Total stockholders’ (deficit) equity attributable to Vinco Ventures, Inc.			(20,089,772	)			15,416,598
Noncontrolling interests			(1,865,863	)			(1,893,897	)
Total stockholders’ equity			(21,955,635	)			13,522,701
Total liabilities and stockholders’ equity		$	45,473,359			$	28,028,207

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

		Three Months Ended March 31,
		2021 (Unaudited)				2020 (Unaudited)
Revenues, net		$	2,565,162			$	1,953,346
Cost of revenues			1,653,381				1,363,719
Gross profit			911,781				589,627
Operating expenses:
Selling, general and administrative			11,660,880				3,288,949
Operating loss			(10,749,099	)			(2,699,322	)
Other (expense) income:
Rental income			25,704				25,704
Interest expense			(12,694,933	)			(723,957		)
Loss on issuance of warrants			(75,156,534	)			-
Change in fair value of warrant liability			36,381,542				-
Change in fair value of short-term investment			(70,000	)			-
Total other income (expense), net			(51,514,221	)			(698,253		)
(Loss) income before income taxes			(62,263,320	)			(3,397,575		)
Income tax expense			-				-
Net loss from continuing operations		$	(62,263,320	)		$	(3,397,575		)
Net income attributable to noncontrolling interests			28,034				-
Net loss attributable to Vinco Ventures, Inc. from continuing operations			(62,291,354	)			(3,397,575		)
Loss from discontinued operations			(178,200	)			(244,693		)
Gain on divestiture from discontinued operations			-				4,911,760
Net (loss) income attributable to Vinco Ventures, Inc.			(62,469,554	)			1,269,492
Net (loss) income per share - basic		$	(3.27	)		$	0.16
Net (loss) income per share - diluted		$	(3.28	)		$	0.13
Weighted average number of common shares outstanding – basic			19,055,006				8,181,470
Weighted average number of common shares outstanding – diluted			19,055,006				9,637,421

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

		Three Months Ended March 31,
		2021 (Unaudited)				2020 (Unaudited)
Cash Flow from Operating Activities
Net income (loss) attributable to Vinco Ventures, Inc.		$	(62,291,354	)		$	(3,397,975	)
Net income attributable to noncontrolling interests			28,034				-
Net income (loss)			(62,263,320	)			(3,397,975	)
Adjustments to reconcile net (income) loss to net cash used in operating activities:
Discontinued operations			(178,200	)			4,667,067
Depreciation and amortization			445,541				316,299
Amortization of financing costs			12,418,930				570,636
Stock-based compensation			8,697,502				1,319,511
Amortization of right of use asset			24,163				77,823
Gain on divestiture			-				(4,911,760	)
Change in fair value of short-term investments			70,000				-
Loss on issuance of warrants			75,156,534
Change in fair value of warrant liability			(36,381,542	)
Changes in assets and liabilities:
Accounts receivable			(494,130	)			64,359
Inventory			(215,717	)			69,089
Prepaid expenses and other current assets			139,635				33,441
Accounts payable			(804,282	)			(215,320	)
Accrued expenses and other current liabilities			(714,500	)			335,815
Operating lease liabilities			(23,723	)			(74,776	)
Due from related party			(17,001	)			(8,115	)
Net cash used in operating activities			(4,140,110	)			(1,153,506	)
Cash Flows from Investing Activities
Purchases of property and equipment			(18,228	)			(31,918	)
Equity method investment			(7,000,000	)			-
Funding of loan receivable			(5,000,000	)			-
Net cash used in investing activities			(12,018,228	)			(31,918	)
Cash Flows from Financing Activities
Net (repayments) borrowings under line of credit			(379,333	)			112,862
Borrowings under convertible notes payable			19,720,000				1,100,000
Borrowings under notes payable			73,000				950,000
Repayments under notes payable			(2,141,782	)			(672,773	)
Repayments under notes payable- related parties			(659,999	)			(14,508	)
Fees paid for financing costs			(122,762	)			(170,815	)
Net proceeds from issuance of common stock			3,255,000				-
Exercise of warrants			1,690,604				-
Net cash provided by financing activities			21,434,726				1,304,766
Net increase (decrease) in cash and cash equivalents			5,276,388				119,342
Cash and cash equivalents - beginning of period			249,356				412,719
Cash and cash equivalents - end of period		$	5,525,744				532,062
Supplemental Disclosures of Cash Flow Information
Cash paid during the period for:
Interest		$	343,824			$	127,504
Income taxes		$	(14,738	)		$	-
Noncash investing and financing activity:
Shares issued to note holders		$	422,672			$	368,000
Conversions under notes payable		$	11,094,020			$	-
Issuance of warrants to note holders		$	22,000,000			$	-

About Vinco Ventures, Inc.

Vinco Ventures, Inc. (BBIG) is a selective acquisitions company focused on digital media and content technologies. Vinco’s B.I.G. Strategy (Buy. Innovate. Grow.) is to seek out acquisition opportunities that are poised for scale and will BE BIG. For more information visit Investors.vincoventures.com.

Use of Non-GAAP Financial Information

EBITDA and Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes that because Adjusted EBITDA excludes (i) certain non-cash expenses (such as depreciation, amortization and stock-based compensation) and (ii) expenses that are not reflective of the Company’s core operating results over time (such as restructuring costs, litigation or dispute settlement charges or gains, and transaction-related costs), this measure provides investors with additional useful information to measure the Company’s financial performance, particularly with respect to changes in performance from period to period. Edison Nation management uses EBITDA and Adjusted EBITDA (a) as a measure of operating performance; (b) for planning and forecasting in future periods; and (c) in communications with the Company’s Board of Directors concerning the Company’s financial performance. The Company’s presentation of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation and should not be used by investors as a substitute or alternative to net income or any measure of financial performance calculated and presented in accordance with U.S. GAAP. Instead, management believes EBITDA and Adjusted EBITDA should be used to supplement the Company’s financial measures derived in accordance with U.S. GAAP to provide a more complete understanding of the trends affecting the business.

Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding strategy, future operations and plans, including assumptions underlying such statements, are forward-looking statements, and should not be relied upon as representing the Company’s views as of any subsequent date. Such forward-looking statements are based on information available to the Company as of the date of this release and involve a number of risks and uncertainties, some beyond the Company’s control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including consumer, regulatory and other factors affecting demand for the Company’s products, any difficulty in marketing the Company’s products in global markets, competition in the market for consumer products and inability to raise capital to fund operations and service the Company’s debt. Additional information that could lead to material changes in the Company’s performance is contained in its filings with the SEC. The Company is under no obligation to, and expressly disclaims any responsibility to, update or alter forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.

Investor Relations:

Aimee Carroll
Phone (866) 900-0992
Email: Investors@vincoventures.com

FAQ

What were the Q1 2021 revenue results for Vinco Ventures (BBIG)?

Vinco Ventures reported Q1 2021 revenue of $2.57 million, reflecting a 31.32% increase from $1.95 million in Q1 2020.

What was the net loss for Vinco Ventures (BBIG) in Q1 2021?

Vinco Ventures reported a net loss of $62.47 million for Q1 2021, compared to a net gain of $1.27 million in the same period last year.

How did the gross margin change for Vinco Ventures (BBIG) in Q1 2021?

The gross margin for Vinco Ventures increased to 35.54% in Q1 2021, up from 30.19% in Q1 2020.

What merger agreement did Vinco Ventures (BBIG) announce?

Vinco Ventures announced a plan to merge with ZASH Global Media and Entertainment Corporation.

What joint venture was formed by Vinco Ventures (BBIG)?

Vinco Ventures entered into a joint venture with ZASH Global Media to form ZVV Media Partners, LLC.