Second Quarter Revenue Increases Over 250% Y-O-Y to $16.9 Million;
First Half Revenue Increases Over 500% Y-O-Y to $40.0 Million
Cash Provided by Operations Grows to $2.5 Million for the First
Half of 2008, Compared to a Loss From Operations of ($2.6)
Million in the Prior Year Period
STUDIO CITY, Calif., Aug. 18, 2008 (GLOBE NEWSWIRE) -- Tix Corporation (Nasdaq:TIXC), a leading integrated entertainment organization offering ticketing services, event merchandising and concert and theatrical productions, today reported results for the three and six months ended June 30, 2008.
Second quarter 2008 revenue increased 258% to $16.9 million, compared to $4.7 million recorded in the comparable period last year. Net loss for the second quarter decreased to $1.2 million, or $(0.04) per diluted share, compared to a loss of $6.2 million, or $(0.32) per diluted share, reported in the second quarter of 2007.
The Company's revenue for the six months ended June 30, 2008 was $40.0 million, compared to $6.5 million during the same period in 2007. Net loss for the first six months of 2008 improved to $704,000, or $(0.02) per diluted share, compared to the first six months 2007 net loss of $6.7 million, or $(0.35) per diluted share.
The Company generated $1.5 million in EBITDA (earnings before interest, taxes, depreciation, and amortization) for the first six months of 2008 compared to an EBITDA loss during the same period last year of $6.5 million.
"We are very pleased with our overall results during the first half of 2008 as strong revenue growth and improving expense margins highlight the success of our strategy to leverage discount ticketing with our merchandising and entertainment businesses," said Mitch Francis, President and CEO of Tix Corporation. "We have successfully built an entertainment platform that has us positioned for long-term profitable growth both organically and through additional strategic acquisitions."
Mr. Francis continued, "Our Ticketing Service segment improved its operating income by over 22% to $1.4 million for the second quarter of 2008. This was offset by an operating loss in our Exhibit Merchandising and Live Entertainment segments due to the seasonal slow-down of touring shows and the slower consumer environment and lower attendance at the exhibits in Europe. We anticipate stronger profitability in the third and fourth quarters of 2008."
Overall revenue from the Company's Ticketing Services subsidiary, Tix4Tonight, which includes revenue from both discount and premium ticket sales, was $3.4 million for the second quarter of 2008 compared to $4.7 million in the prior year period. The Company's discount ticketing division, Tix4Tonight increased ticket sales by 57% to 252,000 tickets and gross ticket sales for the second quarter increased 71% to $12.8 million. Revenue grew 30% to $3.0 million during the second quarter of 2008 compared to $2.3 million in the prior year period. Revenue from the Company's premium ticketing division, Tix4AnyEvent, was $0.3 million compared to $2.4 million in the prior year period, and reflects management's decision to give up certain season seats to sporting events that, though they generated significant income, provided little or no net income. Additionally, during the second quarter of 2007 the Company participated in the distribution of premium tickets to two major boxing matches, for which there was no corresponding event in 2008. Miscellaneous revenue from discount golf, and dinner reservations increased 25% year over year to $71,000. The Company currently has exclusive and non-exclusive agreements with approximately 75 Las Vegas shows and attractions, out of a total of approximately 85 running at any given time.
Exhibit Merchandising (EM), which operates retail specialty stores for touring museum exhibitions, generated revenue of $3.0 million during the second quarter of 2008. EM currently has four gift shops. These include the gift shop for "Tutankhamen and the World of the Pharaohs" in London, England, and Vienna, Austria which operates through September 2008, the gift shop for the "Egyptian Undersea Treasures" in Madrid, Spain that opened April 15, 2008 and a gift shop supporting "Real Pirates," which opened in Philadelphia in May, 2008.
Tix Productions (TPI), comprised of Magic Arts and Entertainment and New Space Entertainment, generated $10.5 million of revenue during the second quarter of 2008 and an operating loss of $418,000. Operating income for the six months ended June 30, 2008 was $1.1 million. TPI currently produces the North American tours of "Michael Flatley's Lord of the Dance," "The Magic of David Copperfield," "Jesus Christ Superstar," and "Rain, The Beatles Experience." During the third and fourth quarters of 2008 the Company's productions will also include "Mannheim Steamroller" and "Bob The Builder Live." The Company is currently working on "101 Dalmations! The Musical!" scheduled for fourth quarter 2009.
Mr. Francis concluded, "In a very short period of time we have built a leading entertainment platform through our three strategic and complementary divisions of Tix4Tonight, Exhibit Merchandising and Tix Productions. We are excited about our long-term growth opportunities in this multi-tiered industry and look forward to improving our operating results in the second half of 2008."
Non-GAAP Financial Measures
The following includes the financial measure of performance earnings before interest, income taxes, depreciation and amortization, or EBITDA, that is a commonly used measure of performance in the entertainment industry. EBITDA is not a measure of performance calculated in accordance with accounting principles generally accepted in United States of America or GAAP. Management has historically evaluated its operating performance with this non-GAAP measure.
EBITDA is presented solely as a supplemental disclosure because (1) management believes it enhances an overall understanding of its past and current performance; (2) management believes it is a useful tool for investors to assess the operating performance of the business in comparison to other entertainment businesses since EBITDA excludes certain items that may not be indicative of management's operating results; (3) measures that are comparable to EBITDA are often used as an important basis for the valuation of entertainment companies; and (4) management uses EBITDA internally to evaluate its operating performance in comparison to its competitors.
The use of EBITDA has certain limitations. EBITDA should be considered in addition to, not as a substitute for or superior to any GAAP financial measure including net income as an indicator of management's performance or cash flows provided by operating activities as an indicator of the Company's liquidity, nor should it be considered as an indicator of management's overall performance. Management's calculation of EBITDA maybe different from the calculation of EBITDA or other similarly titled measurements used by other entertainment companies and therefore comparability may be limited. EBITDA eliminates certain substantial recurring items from net income, such as depreciation, amortization, interest expense and income taxes. Each of these items has been incurred in the past, will continue to be incurred in the future and should be considered in the overall evaluation of the Company's results. We compensate for these limitations by providing the relevant disclosure of depreciation and amortization, interest expense and income taxes are excluded in the calculation of EBITDA both in the reconciliation to the GAAP financial measure of net income (loss) and in the consolidated financial statements and related footnotes, all of which should be considered when evaluating the Company's results. Management strongly encourages readers to review our financial information in its entirety and not to rely on a single measure. A reconciliation of EBITDA to net income (loss) follows:
Three months Three months
ended ended
June 30, 2008 June 30, 2007
------------- -------------
Net loss $(1,166,000) $ (6,196,000)
Interest
income $ 11,000 $ 5,000
Interest
expense (4,000) (40,000)
---------- ---------
Net interest
income
(expense) $ 7,000 7,000 $ (35,000) (35,000)
========== =========
Depreciation 121,000 54,000
Amortization 981,000 66,000
Income taxes (82,000) --
----------- --------------
EBITDA $ (153,000) $ (6,041,000)
=========== ==============
Six months Six months
ended ended
June 30, 2008 June 30, 2007
------------- -------------
Net loss $ (704,000) $ (6,716,000)
Interest
income $ 45,000 $ 12,000
Interest
expense (10,000) (46,000)
---------- ---------
Net interest
income
(expense) $ 35,000 35,000 $ (34,000) (34,000)
========== =========
Depreciation 237,000 99,000
Amortization 1,987,000 85,000
Income Taxes -- --
----------- --------------
EBITDA $ 1,485,000 $ (6,498,000)
=========== ==============
Investor Conference Call
The conference call is scheduled to begin at 6:00 a.m. PT / 9:00 a.m.ET on Tuesday, August 19, 2008. Participants can access the call by dialing 800-762-8779 (domestic) or 480-248-5081 (international). In addition, the call will be webcast on the Investor Relations section of the Company's web site at: www.tixcorp.com where it will also be archived for two weeks. A telephone replay will also be available for two weeks. To access the replay, please dial 800-406-7325 (domestic)or 303-590-3030 (international), passcode 3911832.
About TIX Corporation
Tix Corporation is an integrated entertainment organization offering ticketing services, event merchandising and concert and theatrical productions. It currently operates five prime locations in Las Vegas under the Tix4Tonight marquee -- offering up to a 50 percent discount for same-day shows, concerts, attractions and sporting events. It also offers discount products for golf and dining at its sales locations in Las Vegas. The Company also offers premium tickets to concerts, theater and sporting events throughout he United States under its Tix4AnyEvent.com brand. Its Exhibit Merchandising operation is engaged in branding, product merchandise development and sales activities related to museum exhibitions and other events -- including the King Tutankhamen and Real Pirates tours, selling themed souvenir memorabilia and collector's items in specialty stores in conjunction with the specific events and venues. The Company's newest division, Tix Productions is dedicated to concert and live theatrical promotion and production of events throughout the United States, Canada and Europe and operates under the banners of its recent acquisitions, Magic Arts and Entertainment and NewSpace Entertainment.
Safe Harbor Statement
Except for the historical information contained herein, certain matters discussed in this press release are forward-looking statements which involve risks and uncertainties. These forward-looking statements are based on expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are discussed in the Company's various filings with the Securities and Exchange Commission. The Company assumes no obligation to update these forward-looking statements.
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended June 30,
------------------------------
2008 2007
----------- -----------
(Unaudited) (Unaudited)
Revenues $16,864,000 $ 4,712,000
----------- -----------
Operating expenses:
Direct costs of revenues 12,323,000 2,910,000
Selling and marketing expenses. 799,000 306,000
General and administrative
expenses, including non-cash
equity-based costs of $593,000
and $5,118,000 in 2008 and 2007,
respectively (including $388,000
and $57,000 for officers and
directors in 2008 and 2007,
respectively). 4,059,000 7,541,000
Depreciation and amortization 1,102,000 120,000
----------- -----------
Total costs and expenses 18,283,000 10,877,000
----------- -----------
Operating Loss (1,419,000) (6,165,000)
----------- -----------
Other income (expense):
Other income 164,000 4,000
Interest income 11,000 5,000
Interest expense (4,000) (40,000)
----------- -----------
Other income (expense), net 171,000 (31,000)
----------- -----------
Loss from operations (1,248,000) (6,196,000)
Current income tax (benefit) (82,000) --
----------- -----------
Net loss (1,166,000) (6,196,000)
Other comprehensive loss
Foreign currency translation
adjustments (44,000) --
----------- -----------
Comprehensive loss $(1,210,000) $(6,196,000)
=========== ===========
Net loss per common share -
basic and diluted $ (0.04) $ (0.32)
Weighted average common shares
outstanding - basic and diluted 31,805,228 19,374,693
=========== ===========
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30,
----------------------------
2008 2007
----------- -----------
(Unaudited) (Unaudited)
Revenues $40,027,000 $ 6,459,000
----------- -----------
Operating expenses:
Direct costs of revenues 29,054,000 3,624,000
Selling and marketing expenses. 2,175,000 561,000
General and administrative
expenses, including non-cash
equity-based costs of $1,195,000
and $5,613,000 in 2008 and 2007,
respectively (including $776,000
and $100,000 for officers and
directors in 2008 and 2007,
respectively). 7,521,000 8,776,000
Depreciation and amortization 2,224,000 184,000
----------- -----------
Total costs and expenses 40,974,000 13,145,000
----------- -----------
Operating loss (947,000) (6,686,000)
----------- -----------
Other income (expense):
Other income 208,000 4,000
Interest income 45,000 12,000
Interest expense (10,000) (46,000)
----------- -----------
Other income (expense), net 243,000 (30,000)
----------- -----------
Loss from operations (704,000) (6,716,000)
----------- -----------
Current income tax expense -- --
Net loss (704,000) (6,716,000)
Other comprehensive loss:
Foreign currency translation
adjustments (44,000) --
----------- -----------
Comprehensive loss $ (748,000) $(6,716,000)
=========== ===========
Net loss per common share - basic
and diluted $ (0.02) $ (0.35)
----------- -----------
Weighted average common shares
outstanding -basic and diluted 31,224,025 19,042,164
=========== ===========
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2008 2007
------------- ------------
(Unaudited)
Assets
Current assets:
Cash $ 6,321,000 $ 7,417,000
Other receivable -- 345,000
Accounts receivable, net 1,226,000 129,000
Inventory 4,190,000 3,938,000
Prepaid expenses and other current
assets 278,000 178,000
------------- ------------
Total current assets 12,015,000 12,007,000
------------- ------------
Property and equipment:
Office equipment and furniture 1,742,000 1,413,000
Equipment under capital lease 408,000 386,000
Leasehold improvements 320,000 313,000
------------- ------------
2,470,000 2,112,000
Less accumulated depreciation and
amortization (901,000) (664,000)
------------- ------------
Total property and equipment,
net 1,569,000 1,448,000
------------- ------------
Other assets:
Intangible assets:
Goodwill 31,987,000 27,115,000
Intangible assets, net 15,658,000 14,524,000
------------- ------------
Total intangible assets 47,645,000 41,639,000
Capitalized theatrical costs 459,000 --
Deposits and other assets 75,000 74,000
------------- ------------
Total other assets 48,179,000 41,713,000
------------- ------------
Total assets $ 61,763,000 $ 55,168,000
============= ============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 2,543,000 $ 1,945,000
Accounts payable - related party 330,000 --
Accrued expenses 1,431,000 1,082,000
Current portion of capital lease
obligations 50,000 45,000
Deferred revenue 64,000 54,000
------------- ------------
Total current liabilities 4,418,000 3,126,000
------------- ------------
Non-current liabilities:
Capital lease obligations,
less current portion 103,000 108,000
Deferred rent 114,000 188,000
------------- ------------
Total non-current liabilities 217,000 296,000
------------- ------------
Stockholders' equity:
Preferred stock, $0.01 par value;
500,000 shares authorized; none
issued -- --
Common stock, $0.08 par value;
100,000,000 shares authorized;
32,964,222 shares and 30,402,325
shares issued at June 30, 2008
and December 31, 2007,
respectively 2,637,000 2,432,000
Additional paid-in capital 86,959,000 81,034,000
Accumulated deficit (32,424,000) (31,720,000)
Accumulated other
comprehensive loss (44,000) --
------------- ------------
Total stockholders' equity 57,128,000 51,746,000
------------- ------------
Total liabilities and
stockholders' equity $ 61,763,000 $ 55,168,000
============= ============