- Core Gross Billings Up 31% to $18.1 million, Revenues Up 29% to $18.2 million
- Pre-Corporate EBITDA Up 87% to $1.3 million, EBITDA Up 174% to $1.0 million
-
Progress On Key Strategic Initiatives:
- All offices and individual boards showed double digit growth year over year
- Launched XO Wilhelmina website
- Signed license agreement for an agency in Tokyo, Japan
- Entered into a product licensing arrangement, expected launch late 2014
Quarterly Financial Highlights
| (in thousands) | Q1 14 | Q1 13 | Annual |
| Growth | |||
| Core Gross Billings* | $18,063 | $13,815 | 31% |
| Total Gross Billings* | $18,552 | $14,890 | 25% |
| Total Revenues | $18,236 | $14,116 | 29% |
| Pre-Corporate EBITDA* | $1,279 | $685 | 87% |
| EBITDA* | $1,000 | $365 | 174% |
| *Non-GAAP measures referenced are detailed in the disclosures at the end of this release. | |||
DALLAS, May 14, 2014 (GLOBE NEWSWIRE) -- Wilhelmina International, Inc. (OTCBB:WHLM) ("Wilhelmina" or the "Company"), today reported record total revenues of $18.2 million for the quarter ended March 31, 2014, up 29% from the year ago quarter ended March 31, 2013. Revenues were driven by core gross billings growth of 31% year over year to $18.1 million. The revenue growth, along with solid expense management, drove Pre-Corporate EBITDA up 87% from last year, to $1.3 million. EBITDA increased 174% year over year.
Mark Schwarz, Executive Chairman of Wilhelmina, said, "Wilhelmina had a strong quarter. Recognizing that there is inherent volatility in the business, and that a revenue growth rate of 29% cannot reasonably be extrapolated into the future, we are very pleased with this quarter's solid results. In addition to solid and improving financial performance, Wilhelmina is making progress on many important strategic initiatives."
Alex Vaickus, Chief Executive Officer of Wilhelmina, said, "Our teams of agents and models in New York, Miami, and Los Angeles had a great performance in the quarter, as Wilhelmina continues to build momentum in the core modeling business. All of the major boards had solid increases in bookings, leading to strong financial performance, even while we invest in additional agents and certain growth initiatives. Additionally, we are pleased to announce that a new Wilhelmina licensed modeling agency will be opening in Japan this summer. We also continue to work on additional domestic and international expansion opportunities, both organic and inorganic, in the core modeling business. Another priority is to continue to build the Wilhelmina brand, and with that in mind, we launched the XO Wilhelmina lifestyle and fashion blog during the quarter. We are also excited about the opportunity to create Wilhelmina branded consumer products through licensing arrangements and are working towards launching our first products later this year."
Some recent highlights from our models:
- Alexandra Martynova is the Spring/Summer 2014 face for Tom Ford's Beauty campaign
- Clark Bockelman is the face for Calvin Klein Collection Spring/Summer 2014
- Robyn Lawley appeared on the secondary (peel-away) cover for Cosmopolitan's May 2014 issue
- Danielle Knudson is the new face of GUESS for Spring 2014
- Armando Cabral is featured in the H & M campaign
- Soo Joo was featured on the cover of Vs. Magazine's Spring/Summer 2014 issue
- RJ King and Marlon Teixeira are in Tommy Hilfiger's Spring/Summer 2014 Campaign
Financial Results
The net income applicable to common stockholders was $0.3 million or $0.00 per fully diluted share for the quarter ended March 31, 2014, compared to a net (loss) of ($0.06 million) or ($0.00) per fully diluted share for the quarter ended March 31, 2013.
Pre-Corporate EBITDA was $1.3 million for the quarter ended March 31, 2014, compared to $0.7 million for the quarter ended March 31, 2013.
The following table reconciles operating income (loss) under GAAP (as reported in the Company's SEC filings) to EBITDA and Pre-Corporate EBITDA for the quarter ended March 31, 2014 and 2013.
| (in thousands) | Three months ended | |
| March 31, | ||
| 2014 | 2013 | |
| Operating Income (loss) | $740 | $ (25) |
| Add: Amortization of intangible assets and depreciation | 260 | 390 |
| EBITDA | 1,000 | 365 |
| Add: Corporate overhead (at the holding company level) | 279 | 320 |
| Pre-Corporate EBITDA | $1,279 | $685 |
Increases in net income and Pre-Corporate EBITDA for the quarter ended March 31, 2014 when compared to the quarter ended March 31, 2013 were the result of the following:
-
31% increase in revenues in the core modeling business driven by an expanded developed talent pool and our customers increased interest in booking the Company's talent.
- Operating margins increased due to the Company's continued focus on containing costs while increasing revenues. The amount of salaries and service costs as a percentage of revenue for the quarter ended March 31, 2014 declined to 17.0% compared to 19.8% for the quarter ended March 31, 2013.
| WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES | ||
| Consolidated Balance Sheets | ||
| (In thousands, except share data) | ||
| (Unaudited) | ||
| ASSETS | March 31, | December 31, |
| 2014 | 2013 | |
| Current assets: | ||
| Cash and cash equivalents | $1,005 | $2,776 |
| Accounts receivable, net of allowance for doubtful accounts of $571 | 13,047 | 11,327 |
| Deferred tax asset | 1,414 | 1,659 |
| Prepaid expenses and other current assets | 427 | 257 |
| Total current assets | 15,893 | 16,019 |
| Property and equipment, net of accumulated depreciation of $552 and $493 | 819 | 831 |
| Trademarks and trade names with indefinite lives | 8,467 | 8,467 |
| Other intangibles with finite lives, net of amortization of $8,089 and $7,888 | 248 | 449 |
| Goodwill | 12,563 | 12,563 |
| Restricted cash | 222 | 222 |
| Other assets | 167 | 340 |
| Total assets | $38,379 | $38,891 |
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable and accrued liabilities | $3,048 | $2,969 |
| Due to models | 8,488 | 8,669 |
| Total current liabilities | 11,536 | 11,638 |
| Long term liabilities | ||
| Amegy credit facility | -- | 800 |
| Deferred income tax liability | 1,287 | 1,287 |
| Total long-term liabilities | 1,287 | 2,087 |
| Total liabilities | 12,823 | 13,725 |
| Shareholders' equity: | ||
| Preferred stock, $0.01 par value, 10,000,000 shares authorized; none outstanding | ||
| Common stock, $0.01 par value, 250,000,000 shares authorized; 117,406,651 shares issued and outstanding at March 31, 2014 and December 31, 2013 | 1,294 | 1,294 |
| Treasury stock 12,034,101, at cost | (1,637) | (1,637) |
| Additional paid-in capital | 85,418 | 85,360 |
| Accumulated deficit | (59,519) | (59,851) |
| Total shareholders' equity | 25,556 | 25,166 |
| Total liabilities and shareholders' equity | $38,379 | $38,891 |
| WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES | ||
| Unaudited Consolidated Statements of Operations | ||
| (In thousands, except per share data) | ||
| Three months ended | ||
| March 31, | ||
| 2014 | 2013 | |
| Revenues | ||
| Revenues | $18,136 | $13,915 |
| License fees and other income | 100 | 201 |
| Total revenues | 18,236 | 14,116 |
| Model costs | 12,757 | 9,816 |
| Revenues net of model costs | 5,479 | 4,300 |
| Operating expenses | ||
| Salaries and service costs | 3,105 | 2,797 |
| Office and general expenses | 1,095 | 818 |
| Amortization and depreciation | 260 | 390 |
| Corporate overhead | 279 | 320 |
| Total operating expenses | 4,739 | 4,325 |
| Operating income (loss) | 740 | (25) |
| Other income (expense): | ||
| Equity Earnings in Wilhelmina Kids & Creative Mgmt, LLC | (20) | 17 |
| Interest income | 2 | 2 |
| Interest expense | (8) | (12) |
| Total other income (expense) | (26) | 7 |
| Income (loss) before provision for income taxes | 714 | (18) |
| Provision for income taxes: (expense) benefit | ||
| Current | (137) | (38) |
| Deferred | (245) | -- |
| (382) | (38) | |
| Net income (loss) applicable to common stockholders | $332 | $ (56) |
| Basic income (loss) per common share | $0.00 | $(0.00) |
| Diluted income (loss) per common share | $0.00 | $(0.00) |
| Weighted average common shares outstanding-basic | 117,406 | 119,670 |
| Weighted average common shares outstanding-diluted | 118,337 | 120,500 |
Non GAAP financial measures
The Company calculates Earnings before Interest, Income Taxes, Depreciation and Amortization ("EBITDA") as operating income before depreciation, and amortization expense. The Company calculates Pre-Corporate EBITDA as EBITDA before corporate overhead at the holding company level. The Company calculates Total Gross Billings as the sum total of all amounts invoiced to customers during the period, with no effect giving to amounts which are deferred into future periods, per the terms of a contract. The Company calculates Core Gross Billings as the sum total of all amounts invoiced to customers in the core modeling business during the period, with no effect giving to amounts which are deferred into future periods, per the terms of a contract.
Although EBITDA, Pre-Corporate EBITDA, Total Gross Billings and Core Gross Billings represent non-GAAP financial measures, the Company considers these non-GAAP measures important because they:
- are key operating metrics of the Company's business
- are used by management in its planning and budgeting processes and to monitor and evaluate its financial and operating results
- can be useful to investors since they provide an analysis of financial and operating results using the same measures that the Company uses in evaluating itself.
- provide 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 these non-GAAP measures may not be consistent with calculations of these measures by other companies in the Company's industry.
Non-GAAP financial measure are defined as numerical measures 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 these non-GAAP financial measures to the most directly comparable GAAP financial measures. Non-GAAP measures are not measurements of financial performance under GAAP and should not be considered as alternatives 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.
Table to reconcile revenues as reported to Core Gross Billings and Total Gross Billings
| (in thousands) | Three months ended | |
| March 31, | ||
| 2014 | 2013 | |
| Revenues | $18,136 | $13,915 |
| less: Net revenues from the WAM business | (73) | (100) |
| Core Gross Billings | 18,063 | 13,815 |
| Add: Gross revenues from WAM business | 489 | 1,075 |
| Total Gross Billings | $18,552 | $14,890 |
Form 10-Q Filing
Additional information concerning the Company's results of operations and financial position is included in the Company's Form 10-Q for the three months ended March 31, 2014, which is expected to be filed May 15, 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. (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 Thailand, Dubai, Vancouver and Tokyo.