Mandalay
Media, Inc. Announces Third Quarter Results
Operating
Results Improve by $1 Million Compared to Second Quarter; Company Generates
Positive EBITDA for Month of December
LOS
ANGELES--(BUSINESS WIRE)--Mandalay Media, Inc. (OTCBB: MNDL) (the “Company”
or “Mandalay Media”) announced today results for its third fiscal quarter ended
December 31, 2008. The results include the operating results of AMV Holding
Limited (“AMV”), a European leader in direct-to-consumer mobile Internet content
and services, from October , 2008, when it was acquired by the Company. The
Company had unaudited quarterly (i) revenue of approximately $11.1 million, (ii)
EBITDA, excluding stock option expense and foreign exchange gains/losses
(“Adjusted EBITDA”), a non-GAAP measure, of $(0.2) million, and (iii) a net loss
of $2.6 million, or $0.07 per share. Adjusted EBITDA improved by approximately
$1.1 million on a sequential basis, and was positive for the month of December.
The net loss includes $0.6 million of stock option expense. Mandalay Media had
no operations during the same period in 2007.
For the
nine months ended December 31, 2008, Mandalay Media had unaudited
(i) revenue of $21.4 million, (ii) EBITDA excluding stock option
expense and foreign exchange gains/losses, a non-GAAP measure, of $(2.8 million)
and (iii) a net loss of $8.9 million, or $0.26 per share. The net loss includes
$2.6 million of stock option expense.
Some of
the recent highlights include:
|
|
·
|
M&A: Completed
the acquisition of AMV which expands the Company’s business in UK and
South Africa and accelerates the delivery of direct-to-consumer mobile
Internet content and services. The acquisition more than
doubles the Company’s monthly mobile
revenue.
|
|
|
·
|
D2C
Expansion: Began the expansion of AMV direct-to-consumer
services in key Twistbox markets including the United States, Russia,
Spain and Brazil.
|
|
|
·
|
On-Deck
Expansion: Aggressive conversion of current services to
weekly and monthly subscription models. Launched On-Deck
Services with all major mobile operators in the lucrative Brazilian
market.
|
|
|
·
|
Play-for-Prizes
Expansion: Expanded play-for-prizes distribution in the United
States with operators including Verizon, Sprint, Alltel, Boost and
Nextel.
|
|
|
·
|
Improved Operating
Efficiencies: In December, the Company launched a program to reduce
head count and operating expenses by $3.8 million in connection with the
AMV acquisition and in response to market conditions. Mandalay
expects to begin seeing the impact of the improved operating efficiency in
its fiscal fourth quarter ending March 31, 2009, with the full
impact being realized during the year ended March 31,
2010.
|
“We
believe the completion of the acquisition of AMV accelerates Mandalay Media’s
Direct-to-Consumer revenue and services while strengthening our global position
in the mobile games and Life Style categories.” stated Twistbox CEO Ian Aaron.
“We feel that the ability of the Company to offer new products into markets
where it already has a strong presence should drive incremental revenue as a
result of the acquisition. In addition, the opportunity to achieve operating
efficiencies is substantial, which is why we expect operating results to
continue to improve during fiscal 2010.”
Business
Outlook: The Company expects to generate positive EBITDA, excluding stock option
expense and foreign exchange gains/losses, during its fourth fiscal quarter
ending March 31, 2009.
NON-GAAP
Financial Measures
To comply
with Regulation G promulgated pursuant to the Sarbanes-Oxley Act, Mandalay Media
attached to this news release and will post to the Company's investor relations
web site (www.mandalaymediainc.com)
any reconciliations of differences between non-GAAP financial information that
may be required in connection with issuing the Company's quarterly financial
results.
The
Company, as is common in its industry, uses Adjusted EBITDA as a measure of
performance to demonstrate earnings exclusive of interest and non-cash events.
The Company manages its business based on its cash flows. The Company, in its
daily management of its business affairs and analysis of its monthly, quarterly
and annual performance, makes its decisions based on cash flows. The Company, in
managing its current and future affairs, cannot affect the amortization of the
intangible assets to any material degree, and therefore uses Adjusted EBITDA as
its primary management guide. Since an outside investor may base its evaluation
of the Company's performance based on the Company's net loss not its cash flows,
there is a limitation to the Adjusted EBITDA measurement. Adjusted EBITDA is
not, and should not be considered, an alternative to net loss, loss from
operations, or any other measure for determining operating performance of
liquidity, as determined under accounting principles generally accepted in the
United States (GAAP).
About Mandalay Media,
Inc.:
Managed by leading media and technology
industry executives, the Company’s mission is to build a unique combination of
new media distribution and content companies through acquisitions with domestic
and foreign businesses with strong management teams and historical financial
performance. Through its wholly-owned subsidiary Twistbox Entertainment, Inc.,
the Company is a leading global producer and publisher of mobile entertainment.
Twistbox has exclusive licenses with industry-leading brands, direct
distribution with more than 120 wireless operators in over 45 countries and
provides an extensive portfolio of award-winning games, WAP sites and mobile TV
channels. Its wholly-owned subsidiary AMV Holding Limited is a European
leader in direct-to-consumer mobile Internet content and
services.
For more
information, please visit www.mandalaymediainc.com
or www.twistbox.com.
Safe Harbor:
This
press release contains forward-looking statements about the Company within the
meaning of the Private Securities Litigation Reform Act of 1995. Statements
including words such as “estimate”, “expect”, “anticipate” or “believe” and
statements in the future tense are forward-looking statements. These
forward-looking statements are subject to risks and uncertainties that could
cause actual events or actual future results to differ materially from the
expectations set forth in the forward-looking statements. Some of the factors
which could cause the Company’s results to differ materially from the
expectations include the following: consumer demand for the Company’s products;
consumer spending trends; fluctuations in the currencies of the countries in
which the Company operates against the US dollar; timely development and release
of the Company’s products; competition in the industry; the Company’s ability to
manage expenses; the Company’s ability to manage and sufficiently integrate
acquisitions of other companies; adverse changes in the securities markets; and
other factors described in our filings with the SEC, including our Annual Report
on Form 10-KT for the transition period from January 1, 2008 to March 31, 2008.
The Company does not undertake, and specifically disclaim any obligation, to
release publicly the results of any revisions that may be made to any
forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such
statements.
Contact:
Dan
Schustack, CEOcast, Inc. for Mandalay Media at (212) 732-4300.
|
|
|
3
Months Ended
|
|
|
9
Months Ended
|
|
|
|
|
December
31
|
|
|
December
31
|
|
|
|
|
2008
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
Net
Loss
|
|
$ |
(2.6 |
) |
|
$ |
(8.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
0.1 |
|
|
|
0.2 |
|
|
Amortization
|
|
|
0.4 |
|
|
|
1.0 |
|
|
Option
expense
|
|
|
0.6 |
|
|
|
2.6 |
|
|
Interest
expense
|
|
|
0.5 |
|
|
|
1.4 |
|
|
Income
Tax
|
|
|
0.4 |
|
|
|
0.5 |
|
|
Foreign
exchange loss
|
|
|
0.4 |
|
|
|
0.4 |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$ |
(0.2 |
) |
|
$ |
(2.8 |
) |