Dolphin Entertainment Announces Second Quarter 2020 Results
Dolphin Entertainment (NASDAQ:DLPN) reported its 2020 second quarter results, revealing total revenue of $5.19 million, down from $6.27 million in the same period last year. The operating loss improved to $179,038 from $1.20 million a year prior, while the net loss rose significantly to $2.94 million compared to $796,650 previously. The company also announced the acquisition of Be Social, enhancing its influencer marketing capabilities. This acquisition marks the fifth company added to its marketing group, aligning with its three-year growth strategy.
- Acquisition of Be Social enhances influencer marketing capabilities.
- Operating loss decreased to $179,038 from $1,202,079 year-on-year.
- Total revenue declined by 17.2% year-over-year, from $6,273,983 to $5,194,725.
- Net loss increased significantly to $2,943,601 compared to $796,650 a year ago.
NEW YORK, NY and LOS ANGELES, CA / ACCESSWIRE / August 17, 2020 / Dolphin Entertainment, Inc. (NASDAQ:DLPN), a leading independent entertainment marketing and production company, reports its operating results for the three months ended June 30, 2020.
Bill O'Dowd, CEO of Dolphin Entertainment, commented: "This is a great day at Dolphin Entertainment. Not only have our second quarter results bested both internal and analyst expectations, but we have acquired leading influencer marketing firm Be Social, the fifth member of our Entertainment Publicity and Marketing Super Group. It is no surprise that both content and brands are increasingly marketed online. And, correspondingly, PR campaigns are often won or lost through awareness and "buzz," or the lack thereof, in social media. Having the ability to design and execute best-in-class influencer marketing and social media campaigns to complement the PR strategies created by 42West, Shore Fire Media and The Door was by far our highest priority this year. By combining Be Social with our three industry-leading PR firms, we have added tremendous capabilities, and cross-selling opportunities, to an already powerful group."
"We now have five of the six companies in place, on schedule, from the three-year plan we laid out upon joining NASDAQ in December, 2017," continued O'Dowd. "And, we are thrilled that all five companies were our first choice in their respective verticals. It is on days like today, when we add a new member to the Dolphin family, that we most feel a surge in the momentum behind the unique platform we are building."
Highlights
- Total revenue, fully derived from the Company's core entertainment and publicity segment, was
$5,194,725 for the three months ended June 30, 2020 as compared to$6,273,983 in the same period in the prior year. - Operating loss for the three months ended June 30, 2020 of
$179,038 , which included non-cash items from depreciation and amortization of$496,461 , as compared to operating loss of$1,202,079 including non-cash items for depreciation and amortization of$478,560 for the same period in the prior year. - Net Loss for the three months ended June 30, 2020 of
$2,943,601 , which included non-cash items from net losses from changes in fair value of liabilities in the amount of$1,705,869 and debt amortization in the amount of$856,863 , compared to net loss of$796,650 which included non-cash items from net gains from changes in fair value of liabilities in the amount of$723,116 for the same period in the prior year. - 42West's extraordinary range of client work for 33 programs and individuals earned a total of 145 Emmy nominations. This includes the HBO limited series "Watchmen," which led all programs with 26 nominations including Outstanding Drama Series, as well as Pop TV's comedy "Schitts Creek," a 15-time nominee including nods for Outstanding Comedy Series and all four members of its principal cast (Eugene Levy, Catherine O'Hara, Daniel Levy and Annie Spencer).
- The Door launched "Safe Eats" solution for New York restaurants:. Safe Eats, a 501c3 non-profit organization, answers the call of restaurant owners and consumers during this pandemic by providing the industry's most detailed toolkit for safe dining along with New York's very first trustmark for indoor/outdoor dining, takeout and delivery. Safe Eats provides a continuously updated COVID-19 operator manual, preferred pricing for PPE, and a Safe Eats trustmark/window decal signifying their commitment to public safety.
- The Door announced openings and re-openings of multiple hotel clients including the opening of both Virgin Hotels Nashville and Kenoza Hall located in the Catskills region of New York, as well as the re-opening of Virgin Hotels Chicago and the Viceroy Santa Monica, which is just completing a
$21 million renovation. - Viewpoint Creative completed the strategic design and full-service production of a branding campaign for long-time client Direxion, to introduce a new line-up of strategic weight ETFs. Using consistent brand and animation styles, the Direxion campaign has launched with video pre-rolls, banner ads and in print. The featured products include Direxion's FLYT (Flight to safety), ESNG (ESG) and QMJ (S&P 500 High minus low quality) products. The FLYT ETF, launched into the teeth of the COVID-19 market drawdown, has rapidly achieved success, with over
$30m m in acquired assets since its debut. - Dolphin Entertainment acquired the rights to Special Delivery, an original screenplay written by Brian Hurwitz, and has attached Vaughn Stein to direct. Emerson Davis, Dolphin's Vice-President of Development and Production, is handling development of the project and will oversee production.
- Viewpoint Creative announced the selection of "Worcester 6: Heroes Remembered" into the Boston International Film Festival. Viewpoint Creative conceived, shot, and produced the 5-part short-form digital series on behalf of The Leary Firefighters Foundation to honor the six heroic firefighters that perished in the Worcester Cold Storage Warehouse Fire twenty years ago.
- Furthermore, on June 9, 2020, Dolphin closed on a securities purchase agreement, previously announced on June 5th, 2020, with several institutional investors for the issuance and sale of 7,900,000 shares of its common stock at a price of
$1.05 per share, for aggregate gross proceeds of approximately$8.3 million , in a registered direct offering. - Today, August 17, 2020, announced a major expansion of entertainment marketing capabilities through the acquisition of influencer marketing leader, Be Social. Founded over 8 years ago by Ali Grant, Be Social is a Los Angeles-based digital communications group representing both brands and highly-engaged digital influencers. Be Social has worked with hundreds of leading beauty, fashion and lifestyle brands on influencer campaigns, including H&M, Nordstrom and Disney, oftentimes alongside the roster of digital talent they represent, which include many of the most recognized influencers across social media.
Conference Call Information
To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.
Date, Time: August 17, 2020, at 4:30 p.m. ET
Toll-Free: 877-407-0782
International: 201-689-8567
Live Webcast: https://www.webcaster4.com/Webcast/Page/2225/36620
Conference Call Replay Information
The replay will be available beginning approximately 1 hour after the completion of the live event.
Toll-Free: 877-481-4010
Reference ID: 36620
About Dolphin Entertainment, Inc.
Dolphin Entertainment is a leading independent entertainment marketing and production company. Through our subsidiaries 42West, The Door and Shore Fire Media, we provide expert strategic marketing and publicity services to many of the top brands, both individual and corporate, in the film, television, music and hospitality industries. In December 2019, all three PR firms were ranked among the Observer's "Power 50" PR Firms in the United States, an unprecedented achievement. Dolphin's acquisition of Viewpoint Creative adds full-service creative branding and production capabilities to our marketing group. Dolphin's legacy content production business, founded by Emmy-nominated CEO Bill O'Dowd, has produced multiple feature films and award-winning digital series.
DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(unaudited)
ASSETS | As of June 30, 2020 | As of December 31, 2019 | ||||||
Current | ||||||||
Cash and cash equivalents | $ | 12,560,206 | $ | 2,196,249 | ||||
Restricted cash | 714,089 | 714,089 | ||||||
Accounts receivable, net | 2,521,885 | 3,581,155 | ||||||
Other current assets | 187,504 | 372,872 | ||||||
Total current assets | 15,983,684 | 6,864,365 | ||||||
Capitalized production costs | 274,575 | 203,036 | ||||||
Right-of-use assets | 6,567,094 | 7,435,903 | ||||||
Intangible assets, net of accumulated amortization of | 7,530,549 | 8,361,539 | ||||||
Goodwill | 18,072,825 | 17,947,989 | ||||||
Property, equipment and leasehold improvements, net | 858,098 | 1,036,849 | ||||||
Investments | 220,000 | 220,000 | ||||||
Deposits and other assets | 239,746 | 502,045 | ||||||
Total Assets | $ | 49,746,571 | $ | 42,571,726 | ||||
LIABILITIES | ||||||||
Current | ||||||||
Accounts payable | $ | 966,096 | $ | 832,089 | ||||
Other current liabilities | 2,667,019 | 3,387,130 | ||||||
Line of credit | - | 1,700,390 | ||||||
Term loan | 1,100,357 | - | ||||||
Put Rights | 2,663,237 | 2,879,403 | ||||||
Accrued compensation | 2,625,000 | 2,625,000 | ||||||
Accrued interest | 2,071,073 | 1,986,679 | ||||||
Debt | - | 3,311,198 | ||||||
Paycheck Protection Program loan | 1,041,997 | - | ||||||
Loan from related party | 1,107,873 | 1,107,873 | ||||||
Lease liability | 1,515,458 | 1,610,022 | ||||||
Contract liability | 370,466 | 309,880 | ||||||
Convertible notes payable | 802,500 | 2,383,610 | ||||||
Convertible notes payable at fair value | 740,000 | - | ||||||
Notes payable | 692,743 | 288,237 | ||||||
Total current liabilities | 18,363,819 | 22,421,511 | ||||||
Noncurrent | ||||||||
Put Rights | - | 124,144 | ||||||
Convertible notes payable | 195,000 | 1,100,000 | ||||||
Convertible notes payable at fair value | 1,654,522 | 629,618 | ||||||
Warrants Liability | 585,559 | 189,590 | ||||||
Derivative liability | - | 170,000 | ||||||
Notes payable | 625,429 | 1,074,122 | ||||||
Paycheck Protection Program loan | 1,753,703 | - | ||||||
Contingent consideration | 800,000 | 330,000 | ||||||
Lease liability | 5,659,094 | 6,386,209 | ||||||
Other noncurrent liabilities | 570,000 | 570,000 | ||||||
Total noncurrent liabilities | 11,843,307 | 10,573,683 | ||||||
Total Liabilities | 30,207,126 | 32,995,194 | ||||||
STOCKHOLDERS' EQUITY | ||||||||
Common stock, | 474,142 | 268,402 | ||||||
Preferred Stock, Series C, | 1,000 | 1,000 | ||||||
Additional paid in capital | 115,966,906 | 106,465,896 | ||||||
Accumulated deficit | (96,902,603 | ) | (97,158,766 | ) | ||||
Total Stockholders' Equity | $ | 19,539,445 | $ | 9,576,532 | ||||
Total Liabilities and Stockholders' Equity | $ | 49,746,571 | $ | 42,571,726 | ||||
DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
For the three and six months ended June 30, 2020 and 2019
| For the three months ended | For the six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Entertainment publicity and marketing | $ | 5,194,725 | $ | 6,273,983 | $ | 11,828,525 | $ | 12,523,890 | ||||||||
Content production | - | - | - | 78,990 | ||||||||||||
Total revenues | 5,194,725 | 6,273,983 | 11,828,525 | 12,602,880 | ||||||||||||
Expenses: | ||||||||||||||||
Direct costs | 656,849 | 1,279,657 | 1,285,361 | 2,467,076 | ||||||||||||
Selling, general and administrative | 978,527 | 1,071,460 | 2,223,345 | 1,859,623 | ||||||||||||
Depreciation and amortization | 496,461 | 478,560 | 1,017,464 | 960,203 | ||||||||||||
Legal and professional | 362,853 | 449,061 | 572,314 | 832,732 | ||||||||||||
Payroll | 2,879,073 | 4,197,324 | 7,779,939 | 8,510,486 | ||||||||||||
Total expenses | 5,373,763 | 7,476,062 | 12,878,423 | 14,630,120 | ||||||||||||
Loss before other income (expenses) | (179,038 | ) | (1,202,079 | ) | (1,049,898 | ) | (2,027,240 | ) | ||||||||
Other income (expenses): | ||||||||||||||||
Gain (loss) on extinguishment of debt | - | - | 3,259,866 | (21,287 | ) | |||||||||||
Change in fair value of convertible notes and derivative liabilities | (696,420 | ) | 30,000 | (548,961 | ) | 30,000 | ||||||||||
Loss on deconsolidation of Max Steel VIE | - | - | (1,484,591 | ) | - | |||||||||||
Change in fair value of warrants | (483,519 | ) | 81,766 | (411,004 | ) | 81,766 | ||||||||||
Change in fair value of put rights | 47,070 | 251,350 | 1,517,810 | 1,778,376 | ||||||||||||
Change in fair value of contigent consideration | (573,000 | ) | 360,000 | (470,000 | ) | 90,000 | ||||||||||
Interest expense and debt amortization | (1,058,694 | ) | (317,687 | ) | (1,682,976 | ) | (605,657 | ) | ||||||||
Total other income (expense) | (2,764,563 | ) | 405,429 | 180,144 | 1,353,198 | |||||||||||
Net loss | $ | (2,943,601 | ) | $ | (796,650 | ) | $ | (869,754 | ) | $ | (674,042 | ) | ||||
Loss per share - Basic | $ | (0.12 | ) | $ | (0.05 | ) | $ | (0.04 | ) | $ | (0.04 | ) | ||||
Loss per share - Diluted | $ | (0.12 | ) | $ | (0.05 | ) | $ | (0.09 | ) | $ | (0.12 | ) | ||||
Weighted average number of shares used in per share calculation | ||||||||||||||||
Basic | 23,596,206 | 15,969,926 | 21,818,711 | 15,957,085 | ||||||||||||
Diluted | 25,299,336 | 19,172,087 | 26,071,775 | 19,671,124 | ||||||||||||
CONTACT:
James Carbonara
Hayden IR
(646)-755-7412
james@haydenir.com
SOURCE: Dolphin Entertainment, Inc.
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