FT. LAUDERDALE, Fla., May 15, 2012 (GLOBE NEWSWIRE) -- rVue Holdings, Inc. (OTCBB:RVUE) (the "Company") announced today its financial results for the first quarter ended March 31, 2012.
Operational Highlights for First Quarter and Year-to-Date 2012:
- As of March 10, 2012, 180 Digital Out-of-Home (DOOH) networks comprising approximately 101,000 locations and 763,000 screens were accessible through the rVue platform. rVue can deliver 243 million daily ad impressions across these networks.
- Over past 100 days, rVue enhanced the rVue Demand Side Platform (DSP) with the necessary personnel and resources to support an expanding partner relationship with a tier-1 telecom service provider to jointly pursue the DOOH market opportunity.
- rVue ended the first quarter of 2012 with $256,040 in cash and cash equivalents. On May 10th, 2012, the company's board of directors authorized the increase and sale of an additional $500,000 secured promissory notes to provide additional working capital, and to remove the ratchet provisions in the Notes and the Warrants. On May 11, 2012, the Company raised an additional $300,000 through the sale of secured convertible promissory notes and common stock purchase warrants to an entity that is owned by the Company's largest shareholder and current board member in support of this effort.
"In the first quarter, we solidified our technology partnership with a premiere telecom service provider to jointly market to the U.S. Digital Out-of-Home market opportunity," said Michael Mullarkey, CEO and Chairman of rVue Holdings, Inc. "We are very excited about our Joint Marketing Agreement in which the rVue DSP provides the underlying technology solution while our partner provides the sales and marketing reach. We have moved well beyond the test phase of this relationship at this point in time, and we already have several joint DOOH advertising pilots in the pipeline that will leverage the rVue platform in the second half of 2012. Beyond the core DSP, we are also gaining traction with advertisers in our rVue Direct segment, and we expect that business to ramp up later this year as well. We believe we have established ourselves with advertisers and partners as the leading technology provider for the DOOH industry, and we continue to see large, essentially untapped opportunity ahead."
First Quarter 2012 Financial Details:
First quarter 2012 revenue was $131,488 compared to $236,481 in the prior year's first quarter. rVue fees—the transaction fees from advertisers and agencies for placing ads with networks and primary focus of rVue's business—were $16,319 for the first quarter of 2012, down from $124,443 in the 2011 first quarter, a $108,124, or 86.9% decline, due to the timing of executed and anticipated campaigns. Selling, general and administrative expenses were $927,847 in the first quarter of 2012, compared to $933,112 in the prior year's first quarter, a decline of less than 1%. Interest expense was $296,483, change in fair value of derivative instruments was $443,711 and loss on early extinguishment of debt was $17,456. The Company determined that the embedded conversion feature and the warrants associated with the secured convertible promissory notes it sold in January 2012 are derivatives thus the additional interest charges and change in fair value of derivatives for the 2012 first quarter. Net loss for the first quarter of 2012 was $(1,733,750) compared to a net loss of ($924,061) in the 2011 first quarter. Basic and diluted loss per share was ($0.05) in the first quarter of 2012 compared to ($0.02) in the first quarter of 2011. rVue ended the first quarter of 2012 with $256,040 in cash and cash equivalents.
Corporate Activities:
On May 10, 2012, the Company amended its January 27, 2012 promissory note purchase agreement (PNPA) with investors to increase the maximum aggregate principal amount of secured promissory notes (Notes) issuable to $1,775,000 from $1,275,000, and to remove the ratchet provisions contained in the Notes and the Series C Warrants. On May 11, 2012, the Company issued additional Notes in the aggregate principal amount of $300,000 and Series C Warrants to purchase 750,000 shares of the Company's common stock at $.20 per share, exercisable for a period of five years to an entity that is wholly owned by a stockholder and director of the Company who beneficially controlled 12.8% of the Company's outstanding shares of common stock as of May 14, 2012. The Company received net proceeds of $300,000 from the sale of these additional Notes.
Conference Call Information:
A conference call and live webcast will take place at 4:15 p.m. Eastern Time, on Tuesday, May 15, 2012. Anyone interested in participating should call 1-877-941-4778 if they are calling within the United States or 1-480-629-9715 if calling internationally. There will be a playback available until May 22, 2012. To listen to the playback, please call 1-877-870-5176 if calling within the United States or 1-858-384-5517 if calling internationally. Please use Conference ID number 4539786 for the replay.
The call will also be accompanied live by webcast over the Internet and accessible at http://viavid.net/dce.aspx?sid=000097E3
About rVue:
rVue Holdings, Inc., through its wholly owned subsidiary, rVue, Inc., is an advertising technology and strategic media services company which has developed and operates an integrated advertising exchange and digital distribution platform for the digital media. Through the rVue platform, advertisers have the ability to deliver 243 million daily impressions through Digital Out-of-Home media. rVue's technology is designed to empower its network and advertising partners with intelligent and scalable solutions that provide ROI and accelerate the adoption of rich digital media. For more information, please visit www.rvue.com.
Forward Looking Statements:
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements contained in this press release that are not purely historical are forward-looking statements. Forward-looking statements give the Company's current expectations or forecasts of future events. Such statements are subject to risks and uncertainties that are often difficult to predict and beyond the Company's control, and could cause the Company's results to differ materially from those described. The Company is providing this information as of the date of this press release and does not undertake any obligation to update any forward looking statements contained in this press release as a result of new information, future events or otherwise. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Important factors that could cause such differences include, but are not limited to, the Risk Factors and other information set forth in the Company's Annual Report on Form 10-K filed on March 30, 2012 and in our other filings with the Securities and Exchange Commission.
| rVUE HOLDINGS, INC. | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| March 31, | December 31, | |
| 2012 | 2011 | |
| (unaudited) | ||
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $256,040 | $19,917 |
| Accounts receivable | 16,424 | 105,203 |
| Prepaid expenses | 134,703 | 180,573 |
| Total current assets | 407,167 | 305,693 |
| Property and equipment, net | 37,657 | 46,829 |
| Software development costs | 187,366 | 244,498 |
| Deposits | 17,488 | 17,388 |
| $649,678 | $614,408 | |
| Liabilities and Stockholders' Deficit | ||
| Current liabilities: | ||
| Accounts payable | $179,009 | $202,142 |
| Accrued expenses | 445,344 | 456,339 |
| Convertible notes | 319,238 | 185,248 |
| Derivative liability | 1,106,000 | 100,900 |
| Series C warrants | 553,438 | -- |
| Deferred revenue | 31,975 | 31,975 |
| Total current liabilities | 2,635,004 | 976,604 |
| Stockholders' deficit: | ||
| Preferred stock, $0.001 par value per share; 10,000,000 shares authorized; none issued or outstanding | -- | -- |
| Common stock, $0.001 par value per share; 140,000,000 shares authorized at March 31, 2012 and December 31, 2011 | ||
| 37,863,845 and 37,383,725 shares issued and outstanding at March 31, 2012 and December 31, 2011, respectively | 37,864 | 37,384 |
| Additional paid-in capital | 5,488,145 | 5,378,005 |
| Accumulated deficit | (7,511,335) | (5,777,585) |
| Total stockholders' deficit | (1,985,326) | (362,196) |
| $649,678 | $614,408 | |
| rVUE HOLDINGS, INC. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (unaudited) | ||||
|
For the Three Months Ended March 31, |
||||
| 2012 | 2011 | |||
| Revenue | ||||
| rVue fees | $ 16,319 | $ 124,443 | ||
| Network | 115,169 | 112,038 | ||
| 131,488 | 236,481 | |||
| Costs and expenses | ||||
| Cost of revenue | 56,209 | 104,269 | ||
| Selling, general and administrative expenses | 927,847 | 933,112 | ||
| Depreciation and amortization | 123,668 | 125,518 | ||
| Interest income | (136) | (2,357) | ||
| Interest expense | 296,483 | -- | ||
| Change in fair value of derivative instruments | 443,711 | -- | ||
| Loss on early extinguishment of debt | 17,456 | -- | ||
| 1,865,238 | 1,160,542 | |||
| Loss before provision for income taxes | (1,733,750) | (924,061) | ||
| Provision for income taxes | -- | -- | ||
| Net loss | $ (1,733,750) | $ (924,061) | ||
| Net loss per common share - basic and diluted | $ (0.05) | $ (0.02) | ||
| Shares used in computing net loss per share: | ||||
| Basic and diluted | 37,663,796 | 37,273,725 | ||
| rVUE HOLDINGS, INC. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
| (unaudited) | ||||
|
For the Three Months Ended March 31, |
||||
| 2012 | 2011 | |||
| Operating activities | ||||
| Net loss | $(1,733,750) | $(924,061) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||
| Depreciation and amortization | 123,668 | 125,518 | ||
| Stock-based compensation expense | 15,620 | 160,871 | ||
| Common stock issued for services | 95,000 | -- | ||
| Convertible loan interest | 296,361 | -- | ||
| Change in fair value of derivative instruments | 443,711 | -- | ||
| Loss on early extinguishment of debt | 17,456 | -- | ||
| Changes in operating assets and liabilities: | ||||
| Accounts receivable | 88,779 | 156 | ||
| Prepaid expenses | 45,870 | (26,848) | ||
| Accounts payable | (23,133) | 70,398 | ||
| Accrued expenses | (10,995) | 99,792 | ||
| Cash used in operating activities | (641,413) | (494,174) | ||
| Investing activities | ||||
| Payments for property, equipment and capitalized software development | (57,364) | (148,971) | ||
| Repayments by Argo Digital Solutions, Inc. | -- | 172,012 | ||
| Change in deposits | (100) | -- | ||
| Cash provided by (used in) investing activities | (57,464) | 23,041 | ||
| Financing activities | ||||
| Proceeds from convertible notes | 935,000 | -- | ||
| Cash provided by financing activities | 935,000 | -- | ||
| Increase (decrease) in cash and cash equivalents | 236,123 | (471,133) | ||
| Cash and cash equivalents, beginning of period | 19,917 | 2,334,121 | ||
| Cash and cash equivalents, end of period | $ 256,040 | $1,862,988 | ||