Vinco Ventures, Inc. Reports Financial Results for the Three Months Ended March 31, 2021


Bethlehem, P.A., May 25, 2021 (GLOBE NEWSWIRE) -- Vinco Ventures, Inc. (NASDAQ:BBIG), a digital media merger and acquisitions company, today announced results for the three months ended March 31, 2021.

Company Highlights

 Revenue increased 31.32% for the three months ended March 31, 2021 versus the three months ended March 31, 2020.
   
 Company enters into Agreement to Complete a Plan of Merger with ZASH Global Media and Entertainment Corporation
   
 Company enters into joint venture with ZASH Global Media and Entertainment Corporation forming ZVV Media Partners, LLC

Three Months End March 31, 2021 Financial Summary

Revenue

 Revenue for the three months ended March 31, 2021 increased to $2.57 million as compared to $1.95 million for the three months ended March 31, 2020, a 31.32% increase.
   
 Gross Profit for the three months ended March 31, 2021 increased to $0.9 million as compared to $0.6 million for the three months ended March 31, 2020, a 56.64% decrease.
   
 Gross Margin for the three months ended March 31, 2021 increased to 35.54% as compared to 30.19% for the three months ended March 31, 2020, a 17.72% increase.

Net Loss

 Net loss for the three months ended March 31, 2021 was $62.47 million, or ($3.27) per basic and ($3.28) per diluted share, compared to a net gain of $1.27 million, or $0.166 per basic and $0.13 per diluted share for the three months ended March 31, 2020.

Adjusted EBITDA

 Adjusted EBITDA, a non-GAAP measure, totaled a negative $1.29 million for the three months ended March 31, 2021, compared to a negative $0.92 million for the three months ended March 31, 2020. 
   
 Adjusted EBITDA includes the addback for the loss on issuance of warrant liability of $75.2 million offset by a gain on change in fair value of warrant liability of $36.4 million.

See below, under the heading “Use of Non-GAAP Financial Information,” for a discussion of Adjusted EBITDA and a reconciliation of such measure to the most comparable measure calculated under U.S. generally accepted accounting principles (“GAAP”).

For the three months ended March 31, 2021 and 2020, EBITDA and Adjusted EBITDA consisted of the following:

  For the Three Months
Ended March 31,
 
  2021  2020 
Net income (loss) from continuing operations $(62,263,320) $1,269,492 
Net income (loss) from discontinued operations  (178,200)  - 
Interest expense, net  12,694,933   723,957 
Depreciation and amortization  445,541   316,298 
EBITDA  (49,301,046)  2,309,747 
Stock-based compensation  8,697,502   1,319,511 
Loss on issuance of warrant liability  75,156,534     
Change in fair value of warrant liability  (36,381,542)  - 
Restructuring and severance costs  -   242,136 
Transaction and acquisition costs  704,565   82,736 
Other non-recurring costs  -   40,860 
Gain on divestiture  -   (4,911,760)
   -   - 
Adjusted EBITDA $(1,123,987) $(916,770)


Vinco
Ventures, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS

  March 31,
2021
  December 31,
2020
 
  (Unaudited)    
Assets        
Current assets:        
Cash and cash equivalents $5,525,744  $249,356 
Accounts receivable, net  1,683,294   1,382,163 
Short-term investments  948,000   1,018,000 
Inventory  1,123,261   1,127,725 
Prepaid expenses and other current assets  603,966   522,259 
Current assets of discontinued operations  1,354,546   1,042,680 
Total current assets  11,238,811   5,342,183 
Property and equipment, net  996,217   1,010,801 
Right of use assets, net  128,871   153,034 
Loan receivable  5,000,000   - 
Equity method investment  7,000,000   - 
Intangible assets, net  9,485,370   9,798,813 
Goodwill  5,983,852   5,983,852 
Non-current assets of discontinued operations  5,640,238   5,739,524 
Total assets $45,473,359  $28,028,207 
         
Liabilities and stockholders’ equity        
Current liabilities:        
Accounts payable $1,339,009  $3,618,339 
Accrued expenses and other current liabilities  1,344,750   2,101,610 
Deferred revenues  131,578   152,040 
Current portion of operating leases liabilities  73,054   96,777 
Income tax payable  27,643   27,643 
Line of credit, net of debt issuance costs of $0 and $15,573, respectively  1,133,652   1,500,953 
Current portion of convertible notes payable, net of debt issuance costs of $9,827,778 and $0, respectively  1,172,222   577,260 
Current portion of notes payable, net of debt issuance costs of $0 and $212,848, respectively  441,192   1,301,212 
Current portion of notes payable – related parties  876,500   1,389.923 
Due to related party  15,450   32,452 
Current liabilities of discontinued operations  589,363   487,454 
Total current liabilities  7,144,413   11,285,663 
Operating leases liabilities –net of current portion  58,713   58,713 
Convertible notes payable – related parties, net of current portion, net of debt discount of $172,984 and $366,666, respectively  249,288   1,161,495 
Notes payable, net of current portion  450,002   595,879 
Notes payable – related parties, net of current portion  1,291,013   1,403,756 
Warrant liability  58,235,565   - 
Total liabilities $67,428,994  $14,505,506 
Commitments and Contingencies (Note 12)        
         
Stockholders’ equity        
Preferred stock, $0.001 par value, 30,000,000 shares authorized as of March 31, 2021 and December 31, 2020, respectively  -   - 
Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized; 764,618 and 764,618 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively $765  $765 
Common stock, $0.001 par value, 250,000,000 shares authorized 25,685,981 and 14,471,403 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively  25,686   14,471 
Additional paid-in-capital  66,002,229   39,050,260 
Accumulated deficit  (86,118,452)  (23,648,898)
Total stockholders’ (deficit) equity attributable to Vinco Ventures, Inc.  (20,089,772  15,416,598 
Noncontrolling interests  (1,865,863)  (1,893,897)
Total stockholders’ equity  (21,955,635  13,522,701 
Total liabilities and stockholders’ equity $45,473,359  $28,028,207 

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

  Three Months Ended
March 31,
 
  2021
(Unaudited)
  2020
(Unaudited)
 
       
Revenues, net $2,565,162  $1,953,346  
Cost of revenues  1,653,381   1,363,719  
Gross profit  911,781   589,627  
         
Operating expenses:        
Selling, general and administrative  11,660,880   3,288,949  
Operating loss  (10,749,099)  (2,699,322) 
         
Other (expense) income:        
Rental income  25,704   25,704  
Interest expense  (12,694,933)  (723,957 )
Loss on issuance of warrants  (75,156,534)  -  
Change in fair value of warrant liability  36,381,542   -  
Change in fair value of short-term investment  (70,000)  -  
Total other income (expense), net  (51,514,221)  (698,253 )
(Loss) income before income taxes  (62,263,320)  (3,397,575 )
Income tax expense  -   -  
Net loss from continuing operations $(62,263,320) $(3,397,575 )
Net income attributable to noncontrolling interests  28,034   -  
Net loss attributable to Vinco Ventures, Inc. from continuing operations  (62,291,354)  (3,397,575 )
Loss from discontinued operations  (178,200)  (244,693 )
Gain on divestiture from discontinued operations  -   4,911,760  
Net (loss) income attributable to Vinco Ventures, Inc.  (62,469,554)  1,269,492  
Net (loss) income per share - basic $(3.27) $0.16  
Net (loss) income per share - diluted $(3.28) $0.13  
Weighted average number of common shares outstanding – basic  19,055,006   8,181,470  
Weighted average number of common shares outstanding – diluted  19,055,006   9,637,421  

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

  Three Months Ended March 31, 
  2021
(Unaudited)
  2020
(Unaudited)
 
Cash Flow from Operating Activities        
Net income (loss) attributable to Vinco Ventures, Inc. $(62,291,354) $(3,397,975)
Net income attributable to noncontrolling interests  28,034   - 
Net income (loss)  (62,263,320)  (3,397,975)
Adjustments to reconcile net (income) loss to net cash used in operating activities:        
Discontinued operations  (178,200)  4,667,067 
Depreciation and amortization  445,541   316,299 
Amortization of financing costs  12,418,930   570,636 
Stock-based compensation  8,697,502   1,319,511 
Amortization of right of use asset  24,163   77,823 
Gain on divestiture  -   (4,911,760)
Change in fair value of short-term investments  70,000   - 
Loss on issuance of warrants  75,156,534     
Change in fair value of warrant liability  (36,381,542)    
Changes in assets and liabilities:        
Accounts receivable  (494,130)  64,359 
Inventory  (215,717)  69,089 
Prepaid expenses and other current assets  139,635   33,441 
Accounts payable  (804,282)  (215,320)
Accrued expenses and other current liabilities  (714,500)  335,815 
Operating lease liabilities  (23,723)  (74,776)
Due from related party  (17,001)  (8,115)
Net cash used in operating activities  (4,140,110)  (1,153,506)
         
Cash Flows from Investing Activities        
Purchases of property and equipment  (18,228)  (31,918)
Equity method investment  (7,000,000)  - 
Funding of loan receivable  (5,000,000)  - 
Net cash used in investing activities  (12,018,228)  (31,918)
         
Cash Flows from Financing Activities        
Net (repayments) borrowings under line of credit  (379,333)  112,862 
Borrowings under convertible notes payable  19,720,000   1,100,000 
Borrowings under notes payable  73,000   950,000 
Repayments under notes payable  (2,141,782)  (672,773)
Repayments under notes payable- related parties  (659,999)  (14,508)
Fees paid for financing costs  (122,762)  (170,815)
Net proceeds from issuance of common stock  3,255,000   - 
Exercise of warrants  1,690,604   - 
Net cash provided by financing activities  21,434,726   1,304,766 
Net increase (decrease) in cash and cash equivalents  5,276,388   119,342 
Cash and cash equivalents - beginning of period  249,356   412,719 
Cash and cash equivalents - end of period $5,525,744   532,062 
         
Supplemental Disclosures of Cash Flow Information        
Cash paid during the period for:        
Interest $343,824  $127,504 
Income taxes $(14,738 $- 
Noncash investing and financing activity:        
Shares issued to note holders $422,672  $368,000 
Conversions under notes payable $11,094,020  $- 
Issuance of warrants to note holders $22,000,000  $- 

About Vinco Ventures, Inc.

Vinco Ventures, Inc. (BBIG) is a selective acquisitions company focused on digital media and content technologies. Vinco’s B.I.G. Strategy (Buy. Innovate. Grow.) is to seek out acquisition opportunities that are poised for scale and will BE BIG. For more information visit Investors.vincoventures.com.

Use of Non-GAAP Financial Information

EBITDA and Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes that because Adjusted EBITDA excludes (i) certain non-cash expenses (such as depreciation, amortization and stock-based compensation) and (ii) expenses that are not reflective of the Company’s core operating results over time (such as restructuring costs, litigation or dispute settlement charges or gains, and transaction-related costs), this measure provides investors with additional useful information to measure the Company’s financial performance, particularly with respect to changes in performance from period to period. Edison Nation management uses EBITDA and Adjusted EBITDA (a) as a measure of operating performance; (b) for planning and forecasting in future periods; and (c) in communications with the Company’s Board of Directors concerning the Company’s financial performance. The Company’s presentation of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation and should not be used by investors as a substitute or alternative to net income or any measure of financial performance calculated and presented in accordance with U.S. GAAP. Instead, management believes EBITDA and Adjusted EBITDA should be used to supplement the Company’s financial measures derived in accordance with U.S. GAAP to provide a more complete understanding of the trends affecting the business.

Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding strategy, future operations and plans, including assumptions underlying such statements, are forward-looking statements, and should not be relied upon as representing the Company’s views as of any subsequent date. Such forward-looking statements are based on information available to the Company as of the date of this release and involve a number of risks and uncertainties, some beyond the Company’s control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including consumer, regulatory and other factors affecting demand for the Company’s products, any difficulty in marketing the Company’s products in global markets, competition in the market for consumer products and inability to raise capital to fund operations and service the Company’s debt. Additional information that could lead to material changes in the Company’s performance is contained in its filings with the SEC. The Company is under no obligation to, and expressly disclaims any responsibility to, update or alter forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.

Investor Relations:

Aimee Carroll
Phone (866) 900-0992
Email: Investors@vincoventures.com