Dolphin Entertainment Reports Third Quarter Financial Results

MIAMI, FL / ACCESSWIRE / November 14, 2019 / Dolphin Entertainment, Inc. (NASDAQ:DLPN), a leading independent entertainment marketing and premium content development company, announces its financial results for the period ended September 30, 2019.

Bill O’Dowd, CEO of Dolphin Entertainment, commented: “We are pleased to share that Dolphin exceeded consensus expectations in both revenue and earnings per share in the third quarter, which we attribute to the increased cross-selling of services between members of our Entertainment Marketing “Super Group.” Our investments in these companies have led to our double-digit revenue growth through the first nine months of 2019, and we anticipate positive net income on a going-forward basis. Also, we took important steps on the M&A front, and we expect that we will have our fourth acquisition finished shortly, and that we are on target to complete the acquisition of all 6 “core competency” members of our Entertainment Marketing “Super Group” on schedule within 2020, which we believe will increase our cross-selling opportunities and accelerate growth of both revenues and profits.”

Highlights

  • Total quarterly revenue increased 4% year-over-year to $5,948,056 and nine-month revenue increased 11% to $18,550,936.
  • Entertainment Publicity and Marketing revenue increased 13% year over year to $18,464,330 for the nine months ended September 30, 2019.
  • Operating loss for the three months ended September 30, 2019 of $(1,412,171), which included impairments to deferred production costs of Max Steel under the caption “direct costs” of $629,585 and non-cash items from depreciation and amortization of $485,965, compared to operating losses of $(538,840), which included non-cash items from depreciation and amortization of $599,078, for the same period in the prior year.
  • Net loss before income taxes for the three months ended September 30, 2019 of $(350,831), compared to net loss before income taxes of $(639,306) for the same period in the prior year. The Company does not have an income tax expense or benefit in the current quarter but had an income tax benefit of $819,451 for the three months ended September 30, 2018.
  • 42West and The Door were selected to lead marketing efforts for the 45th annual Saturn Awards.
  • Veteran PR Professional Jodie Magid Oriol joined 42west As Vice President – New York Entertainment Marketing Division
  • The Door expanded its national footprint with the launch of Miami office
  • Closed a $2.1 Million offering of common stock at market, with no warrants issued

Conference Call Information

To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.
Date, Time: Thursday, November 14, 2019, at 4:30 p.m. ET
Toll-free: 844-369-8770
International: 862-298-0840
Live Webcast: https://www.investornetwork.com/event/presentation/56833

Conference Call Replay Information

The replay will be available beginning approximately 1 hour after the completion of the live event.
Toll-free: 877-481-4010
Reference ID: 56833

About Dolphin Entertainment, Inc.

Dolphin Entertainment, Inc. is a leading independent entertainment marketing and premium content development company. Through our subsidiaries 42West and The Door, we provide expert strategic marketing and publicity services to many of the top brands, both individual and corporate, in the entertainment and hospitality industries. The Door and 42West are both recognized global leaders in PR services for their respective industries and, in December 2017, the New York Observer listed them, respectively, as the third and fourth most powerful PR firms of any kind in the United States. Dolphin’s recent acquisition of Viewpoint Creative adds full-service creative branding and production capabilities to our marketing group. Dolphin’s legacy content production business, founded by Emmy-nominated CEO Bill O’Dowd, has produced multiple feature films and award-winning digital series.

Contact:

James Carbonara
Hayden IR
(646)-755-7412
james@haydenir.com

This press release contains ‘forward-looking statements’ within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, Dolphin Entertainment Inc.’s offering of common stock as well as expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by the use of words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, Dolphin Entertainment’s actual results may differ materially from the results discussed in its forward-looking statements. Dolphin Entertainment’s forward-looking statements contained herein speak only as of the date of this press release. Factors or events Dolphin Entertainment cannot predict, including those described in the risk factors contained in its filings with the Securities and Exchange Commission, may cause its actual results to differ from those expressed in forward-looking statements. Although Dolphin Entertainment believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved, and Dolphin Entertainment undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(unaudited)

             
ASSETS
  As of September 30, 2019     As of December 31, 2018  
Current
           
Cash and cash equivalents
  $ 1,550,799     $ 5,542,272  
Restricted cash
    714,016       732,368  
Accounts receivable, net of allowance for doubtful accounts of $311,649 and $283,022, respectively.
    3,023,870       3,173,107  
Other current assets
    576,799       620,970  
Total current assets
    5,865,484       10,068,717  
Capitalized production costs
    224,024       724,585  
Intangible assets, net of accumulated amortization of $3,884,448 and $2,689,704, respectively.
    7,696,885       9,395,215  
Goodwill
    15,996,977       15,922,601  
Right-of-use asset
    6,139,776        
Property, equipment and leasehold improvements, net
    962,085       1,182,520  
Investments
    220,000       220,000  
Deposits and other assets
    502,399       475,956  
Total Assets
  $ 37,607,630     $ 37,989,594  
LIABILITIES
               
Current
               
Accounts payable
  $ 769,608     $ 944,232  
Other current liabilities
    4,427,469       7,238,507  
Line of credit
    1,700,390       1,700,390  
Put rights
    2,912,246       4,281,595  
Accrued compensation
    2,637,500       2,625,000  
Debt
    3,311,199       2,411,828  
Loan from related party
    1,107,873       1,107,873  
Contract liability
    311,484       522,620  
Lease liability
    1,404,938        
Convertible notes payable, net of debt discount
    2,721,731       625,000  
Notes payable
    286,068       479,874  
Total current liabilities
    21,590,506       21,936,919  
Noncurrent
               
Put rights
    365,646       1,702,472  
Convertible notes payable
    1,477,597       1,376,924  
Notes payable
    747,012       612,359  
Contingent consideration
    440,000       550,000  
Lease liability
    5,269,239        
Other noncurrent liabilities
          1,034,393  
Total noncurrent liabilities
    8,299,494       5,276,148  
Total Liabilities
    29,890,000       27,213,067  
 
               
Commitments and contingencies (Note 19)
               
STOCKHOLDERS’ EQUITY
               
Common stock, $0.015 par value, 200,000,000 shares authorized,14,641,466and 14,123,157, respectively, issued and outstanding at September 30, 2019 and December 31, 2018.
    219,624       211,849  
Preferred Stock, Series C, $0.001 par value, 50,000 authorized, issued and outstanding at September 30, 2019 and December 31, 2018.
    1,000       1,000  
Additional paid in capital
    103,146,270       105,092,852  
Accumulated deficit
    (95,649,264 )     (94,529,174 )
Total Stockholders’ Equity
    7,717,630       10,776,527  
Total Liabilities and Stockholders’ Equity
  $ 37,607,630     $ 37,989,594  
                 

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
For the three and nine months ended September 30, 2019 and 2018

             
 
  For the three months ended     For the nine months ended  
 
  September 30,     September 30,  
 
  2019     2018     2019     2018  
 
                       
Revenues:
                       
Entertainment publicity and marketing
  $ 5,940,440     $ 5,720,264     $ 18,464,330     $ 16,297,466  
Content production
    7,616             86,606       427,153  
Total revenues
    5,948,056       5,720,264       18,550,936       16,724,619  
 
                               
Expenses:
                               
Direct costs
    1,540,711       333,041       4,006,806       1,199,165  
Selling, general and administrative
    1,023,757       1,111,516       2,875,348       2,547,621  
Depreciation and amortization
    485,965       599,078       1,446,168       1,345,421  
Legal and professional
    353,699       601,330       1,158,497       1,445,818  
Payroll
    3,956,095       3,614,139       12,503,528       10,755,111  
Total expenses
    7,360,227       6,259,104       21,990,347       17,293,136  
Loss before other income (expenses)
    (1,412,171 )     (538,840 )     (3,439,411 )     (568,517 )
 
                               
Other Income (expenses):
                               
Gain (loss) on extinguishment of debt, net
    709,097             687,811       (53,271 )
Acquisition costs
          (182,504 )           (217,174 )
Change in fair value of put rights
    627,799       (110,840 )     2,406,175       1,305,797  
Change in fair value of contingent consideration
    20,000       470,000       110,000       470,000  
Interest expense
    (295,556 )     (277,122 )     (884,665 )     (810,521 )
Total other income (expenses)
    1,061,340       (100,466 )     2,319,321       694,831  
(Loss) Income before income taxes
  $ (350,831 )   $ (639,306 )   $ (1,120,090 )   $ 126,314  
Income taxes
          819,451             538,831  
Net (loss) income
  $ (350,831 )   $ 180,145     $ (1,120,090 )   $ 665,145  
 
                               
(Loss) income per Share:
                               
Basic
  $ (0.02 )   $ 0.01     $ (0.07 )   $ 0.05  
Diluted
  $ (0.05 )   $ 0.01     $ (0.17 )   $ (0.04 )
Weighted average number of shares used in per share calculation
                               
Basic
    16,071,891       14,565,766       15,995,774       13,151,649  
Diluted
    19,847,935       14,565,766       20,225,129       15,255,445  
                                 

 SOURCE: Dolphin Entertainment, Inc.

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