Wilhelmina International, Inc. Reports Fourth Quarter and Fiscal Year 2013 Financial Results

DALLAS, March 31, 2014 (GLOBE NEWSWIRE) -- Wilhelmina International, Inc. (OTCBB:WHLM) (the "Company") today reported record total revenues of $17.6 million and $66.0 million for the quarter and year ended December 31, 2013, respectively, compared to $14.0 million and $56.4 million for the quarter and year ended December 31, 2012, respectively. The increases in revenues were driven by record revenues in the core modeling business.

The net income applicable to common stockholders was $2,573,000 or $0.02 per fully diluted share and $3,392,000 or $0.03 per fully diluted share for the quarter and year ended December 31, 2013, respectively, compared to a net income (loss) of ($65,000) or ($0.00) per fully diluted share and $1,062,000 or $0.01 per fully diluted share for the quarter and year ended December 31, 2012, respectively.

The net income for the quarter and year ended December 31, 2013 includes before tax charges of $395,000 and $1,572,000 for amortization of intangible assets and depreciation, and $289,000 and $1,198,000 for corporate overhead, respectively. The net income for the year ended December 31, 2013 also includes a deferred tax benefit of $2,170,000, as a result of the management's decision to reverse the Company's deferred tax asset ("DTA") valuation allowance. The decision to reverse the DTA valuation allowance is based on the sustained profitability by the Company in recent years and management's expectation of sufficient profitability in subsequent years to fully utilize the Company's net operating losses.

The net income for the quarter and year ended December 31, 2012 includes before tax charges of $392,000 and $1,564,000 for amortization of intangible assets and depreciation and $284,000 and $1,428,000 for corporate overhead, respectively.

The Company experienced a 26% and 21% increase in gross billings across the core modeling business, during the quarter and year ended December 31, 2013, respectively, which were somewhat offset by significant decreases in the gross billings of the WAM business, when compared to the gross billings across the core modeling and WAM businesses for the quarter and year ended December 31, 2012. Gross billings of the WAM business decreased due to reduced fixed payments earned under a product licensing agreement (per the terms of the contract) and due to the expiration of another product licensing agreement (per the terms of the contract), which the Company was a party to, with a former talent. Gross billings of the WAM division represented approximately 2% and 5% of total gross billings for the quarter and year ended December 31, 2013, respectively, compared to approximately 14% and 16% of total gross billings for the quarter and year ended December 31, 2012, respectively.

Adjusted EBITDA⁽¹⁾ was $1.0 million and $4.6 million for the quarter and year ended December 31, 2013, respectively, compared to $0.7 million and $4.5 million for the quarter and year ended December 31, 2012, respectively.

Changes in Adjusted EBITDA for the quarter and year ended December 31, 2013 when compared to the quarter and year ended December 31, 2012 were the result of the following:

• Adjusted EBITDA of $1.0m for the quarter ended December 31, 2013, was driven by a 26% increase in revenues in the core modeling business, offset somewhat by declines in the operating results of the WAM business and increases in salaries and service costs.
   
• Adjusted EBITDA of $4.6m for the year ended December 31, 2013, was driven by record revenues in the core modeling business offset somewhat by declines in the operating results of the WAM business and increases in salaries and service costs.

1) For definitions of Adjusted EBITDA (as defined by the Company) and applicable reconciliation see Non GAAP financial measures discussion below.

During the year ended December 31, 2013, the Board of Directors renewed and extended the Company's share repurchase authority to enable it to repurchase up to an additional 10,000,000 shares of Common Stock. The total authority granted under the repurchase program is 20,000,000 shares. As of March 31, 2014, the Company has repurchased under the stock repurchase program a total of 12,034,101 shares of Common Stock at an average price of approximately $0.136 per share, for a total of approximately $1,637,000. The Company has remaining authority to repurchase 7,965,899 additional shares of Common Stock under the repurchase program.

Non GAAP financial measures

The following table reconciles operating income (loss) under GAAP (in thousands) (as reported in the Company's SEC filings) to Adjusted EBITDA for the quarter and year ended December 31, 2013 and 2012.

Although Adjusted EBITDA represents a non-GAAP financial measure, the Company considers Adjusted EBITDA to be a key operating metric of the Company's business, and uses Adjusted EBITDA in its planning and budgeting processes and to monitor and evaluate its financial and operating results. The Company believes that Adjusted EBITDA is useful to investors because it provides an analysis of financial and operating results using the same measure that the Company uses in evaluating itself. The Company believes that Adjusted EBITDA also provides stockholders and potential investors with a means to evaluate the Company's financial and operating results against other companies within the Company's industry. However, the Company's calculation of Adjusted EBITDA may not be consistent with the calculation of this measure by other companies in the Company's industry.

The Company defines Adjusted EBITDA as operating income before depreciation and amortization and corporate overhead at the holding company level. Adjusted EBITDA is a non-GAAP financial measure, defined as a numerical measure of financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles ("GAAP") in a company's statements of operations, balance sheets or statements of cash flows. Pursuant to the requirements of Regulation G, the Company provides a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to operating income as an indicator of the Company's operating performance or cash flows from operating activities, as a measure of liquidity or any other measure of performance derived in accordance with GAAP.

Form 10-K Filing

Additional information concerning the Company's results of operations and financial position is included in the Company's Form 10-K for the year ended December 31, 2013, which was filed March 31, 2014, with the Securities and Exchange Commission.

Forward-Looking Statements

This report contains certain "forward-looking" statements as such term is defined in the Private Securities Litigation Reform Act of 1995 and information relating to the Company and its subsidiaries that are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. When used in this report, the words "anticipate", "believe", "estimate", "expect" and "intend" and words or phrases of similar import, as they relate to the Company or its subsidiaries or Company management, are intended to identify forward-looking statements. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including, without limitation, competitive factors, general economic conditions, the interest rate environment, governmental regulation and supervision, seasonality, changes in industry practices, one-time events and other factors described herein and in other filings made by the Company with the SEC. Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company does not intend to update these forward-looking statements.

About Wilhelmina International, Inc. and Wilhelmina Artist Management (www.wilhelmina.com):

Through Wilhelmina Models and its other subsidiaries, including, Wilhelmina Artist Management, Wilhelmina International, Inc. provides traditional, full-service fashion model and talent management services, specializing in the representation and management of leading models, entertainers, artists, athletes and other talent to various customers and clients, including, retailers, designers, advertising agencies and catalog companies. Wilhelmina Models was founded in 1967 by Wilhelmina Cooper, a renowned fashion model, and is one of the oldest and largest fashion model management companies in the world. Wilhelmina Models is headquartered in New York and, since its founding, has grown to include operations located in Los Angeles and Miami, as well as a growing network of licensees comprising leading modeling agencies in various local markets across the U.S.as well as in Panama, Thailand, Dubai, Vancouver and Tokyo.