NEW YORK, Nov. 14, 2013 /PRNewswire/ -- YOU On Demand
Holdings, Inc. (NASDAQ: YOD) ("YOU On Demand" or the "Company"), a
leading multi-platform entertainment and Video On Demand (VOD)
company in China, announced today
its unaudited operating results for the three-month period ended
September 30, 2013 (a full copy of
its quarterly report on Form 10-Q will also be posted at
www.sec.gov).
Conference Call: Chairman Shane McMahon and Chief Financial Officer
Marc Urbach are hosting a conference
call today beginning at 4:30 p.m. ET
(1:30 p.m. PT). The dial-in numbers are
(800) 621-4410 or
(+1) (303) 223-2680 (international
callers).
On November 5 (subsequent to
the close of the 2013 third quarter), the Company announced that C
Media Limited, a leading China-based mobile video service provider,
raised its aggregate strategic investment in YOU On Demand to
$6.0 million USD, with an additional
$2.0 million USD Convertible Bridge
Note financing. In addition, C Media and YOU On Demand jointly
agreed to extend C Media's Phase 2 investment deadline – for up to
$10.0 million USD of additional
capital – to December 4, 2013. As
previously disclosed in early July, C Media had made an initial
$4.0 million USD investment in YOU On
Demand.
In addition and also subsequent to quarter-end, the
Company forged a mobile distribution agreement with
Huawei, a leading global information and
communications technology (ICT) solutions provider and the third
largest global smartphone manufacturer. Per the agreement, Huawei
is offering its mobile customers feature films through YOU On
Demand's newly launched mobile application (App), YOU Cinema. The
YOU Cinema App is now coming pre-loaded on Huawei Mate smartphones featuring various
Hollywood
titles.
Shane McMahon, Chairman of
YOU On Demand, commented, "C Media's strategic investment, in
multiple tranches, as well as our new mobile content distribution
agreement with Huawei via the YOU Cinema App, are milestones for
our organization. Partnering with these two
respected China-based
organizations provides us with the requisite resources to continue
YOU On Demand's rapid expansion, awareness and brand recognition
across multiple distribution platforms, especially in the mobile
space. We also plan to deploy a portion of C Media's investment in
further diversifying our array of entertainment content and
continue building YOU On Demand's multi-platform brand."
YOD Q3 2013 Operating Results
Marc Urbach, YOU On Demand's
President & CFO, commented, "We are delighted with the very
strong relationship YOD has been developing with the C Media team
over the past several months and we look forward to achieving
additional milestones as defined in our business plan in the coming
months, specifically with the financial and technological backing
of C Media. We have been strengthening our
balance sheet in recent quarters, reflecting their growing capital
investment, plus the additional $4.7
million cash infusion we recently received following our
divestiture of the non-core Jinan Broadband assets."
Revenue for the quarter ended September 30, 2013 amounted to $0.1 million, while total operating expenses
declined approximately 35% to $2.0
million. This lower cost base helped lead to a more than 30%
reduction in the Company's operating loss, to $2.6 million in Q3. A one-time $5.6 million gain on the sale of YOD's non-core
Jinan Broadband assets resulted in net income of $3.0 million, or diluted EPS of $0.14 per share – based on 15.6 million weighted
average shares outstanding at quarter-end.
The cash and cash equivalents balance at September 30, 2013 was $1.2 million, but this does not reflect the
additional $2.0 million infusion from
C Media on November 5, 2013, nor the
remaining cash balance payment received from the sale of the legacy
Jinan Broadband assets on November 1,
2013.
About YOU On Demand Holdings, Inc.
(www.yod.com)
YOU
On Demand (NASDAQ: YOD), is a leading multi-platform entertainment
company delivering premium content, including leading Hollywood and China-produced movie titles, to customers
across China via Subscription
Video On Demand and Transactional Video On Demand. The Company has
secured alliances with leading global media operators and content
developers. YOU On Demand has content distribution agreements
in place with many of Hollywood's top studios including Disney
Media Distribution, Paramount Pictures, NBC Universal, Warner
Bros., Miramax Films, Lionsgate and Magnolia Pictures, as well as a
broad selection of the best content from Chinese filmmakers. The
Company has a comprehensive end-to-end secure delivery system,
governmental partnerships and approvals and offers additional
value-added services. YOU On Demand has strategic partnerships with
the largest media entities in China, a highly experienced management team
with international background and expertise in Cable, Television,
Film, Digital Media, Internet and Telecom. YOU On Demand is
headquartered in New York, NY with
its China headquarters in
Beijing.
Safe Harbor Statement
This press release
contains certain statements that may include "forward looking
statements." All statements other than statements of historical
fact included herein are "forward-looking statements." These
forward looking statements are often identified by the use of
forward-looking terminology such as "believes," "expects" or
similar expressions, involve known and unknown risks and
uncertainties. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, they
do involve assumptions, risks and uncertainties, and these
expectations may prove to be incorrect. You should not place undue
reliance on these forward-looking statements, which speak only as
of the date of this press release. The Company's actual results
could differ materially from those anticipated in these
forward-looking statements as a result of a variety of factors,
including those discussed in the Company's periodic reports that
are filed with the Securities and Exchange Commission and available
on its website (http://www.sec.gov). All
forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by
these factors. Other than as required under the securities laws,
the Company does not assume a duty to update these forward-looking
statements.
CONTACT:
|
|
Jason Finkelstein
|
Robert Rinderman or
Norberto Aja
|
YOU On Demand
|
JCIR – Investor Relations/Corporate
Communications
|
212-206-1216
|
212-835-8500
|
jason.finkelstein@yod.com
|
YOD@jcir.com
|
@youondemand
|
|
- Financial Tables Follow -
YOU On Demand Holdings, Inc. and Its
Subsidiaries
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Three Months Ended
|
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Nine Months Ended
|
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September 30,
|
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September 30,
|
|
September 30,
|
|
September 30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
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|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
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|
|
|
|
|
|
|
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Revenue
|
$
|
95,295
|
|
$
|
4,176
|
|
$
|
146,852
|
|
$
|
1,699,702
|
Cost of revenue
|
|
712,327
|
|
|
714,250
|
|
|
2,350,931
|
|
|
2,739,032
|
Gross loss
|
|
(617,032)
|
|
|
(710,074)
|
|
|
(2,204,079)
|
|
|
(1,039,330)
|
Operating expense:
|
|
|
|
|
|
|
|
|
|
|
|
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Selling, general and administrative
expenses
|
|
1,658,255
|
|
|
2,331,402
|
|
|
5,558,195
|
|
|
7,130,959
|
|
Professional fees
|
|
147,091
|
|
|
138,063
|
|
|
772,403
|
|
|
1,078,855
|
|
Depreciation and amortization
|
|
154,719
|
|
|
533,557
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|
|
620,946
|
|
|
1,625,146
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|
Impairments of long-lived assets
|
|
-
|
|
|
-
|
|
|
311,249
|
|
|
-
|
Total operating expense
|
|
1,960,065
|
|
|
3,003,022
|
|
|
7,262,793
|
|
|
9,834,960
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|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
(2,577,097)
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|
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(3,713,096)
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|
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(9,466,872)
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|
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(10,874,290)
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|
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|
|
|
|
|
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|
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|
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Interest & other income /
(expense)
|
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|
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|
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Interest income
|
|
611
|
|
|
360
|
|
|
1,185
|
|
|
2,763
|
|
Interest expense
|
|
(30,429)
|
|
|
(27,802)
|
|
|
(90,067)
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|
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(47,699)
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Stock purchase right
|
|
-
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|
|
-
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|
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-
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(43,748)
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Change in fair value of warrant
liabilities
|
|
(6,840)
|
|
|
(636,308)
|
|
|
(37,130)
|
|
|
(636,308)
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|
Change in fair value of contingent
consideration
|
|
(15,649)
|
|
|
537,784
|
|
|
(99,343)
|
|
|
74,351
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|
Gain on investment in unconsolidated
entities
|
|
8,592
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|
|
64,797
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|
|
7,873
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|
|
52,291
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|
Loss on write-off of uncollectible
loans
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(473,698)
|
|
Gain on deconsolidation of Shandong
Media
|
|
-
|
|
|
141,814
|
|
|
-
|
|
|
141,814
|
|
Other
|
|
(11,827)
|
|
|
(1,473)
|
|
|
58,769
|
|
|
(60,035)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss before income taxes and non-controlling
interest
|
|
(2,632,639)
|
|
|
(3,633,924)
|
|
|
(9,625,585)
|
|
|
(11,864,559)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
|
|
21,168
|
|
|
96,026
|
|
|
82,129
|
|
|
266,126
|
|
|
|
|
|
|
|
|
|
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|
|
Net loss from continuing operations
|
|
(2,611,471)
|
|
|
3,537,898
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|
|
(9,543,456)
|
|
|
(11,598,433)
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|
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|
|
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Net gain (loss) from discontinued
operations
|
|
|
|
|
|
|
|
|
|
|
|
(including gain on disposal of
$5,616,269)
|
|
5,589,872
|
|
|
(899,529)
|
|
|
5,255,474
|
|
|
(1,873,947)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
2,978,401
|
|
|
(4,437,427)
|
|
|
(4,287,982)
|
|
|
(13,472,380)
|
Plus: Net loss
attributable to non-controlling interests
|
|
193,512
|
|
|
389,274
|
|
|
834,685
|
|
|
1,482,536
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to YOU On Demand
shareholders
|
|
3,171,913
|
|
|
(4,048,153)
|
|
|
(3,453,297)
|
|
|
(11,989,844)
|
Dividends on preferred stock
|
|
(1,029,829)
|
|
|
-
|
|
|
(1,029,829)
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|
|
-
|
Net income (loss) attributable to YOU
On
Demand common shareholders
|
$
|
2,142,084
|
|
$
|
(4,048,153)
|
|
$
|
(4,483,126)
|
|
$
|
(11,989,844)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
|
|
|
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|
|
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Loss from continuing operations
|
$
|
(0.22)
|
|
$
|
(0.32)
|
|
$
|
(0.65)
|
|
$
|
(1.02)
|
|
Gain (loss) from discontinued
operations
|
|
0.36
|
|
|
(0.04)
|
|
|
0.35
|
|
|
(0.09)
|
|
Basic earnings (loss) per shares
|
$
|
0.14
|
|
$
|
(0.36)
|
|
$
|
(0.30)
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|
$
|
(1.11)
|
|
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|
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Diluted earnings (loss)per share
|
|
|
|
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|
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|
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Loss from continuing operations
|
$
|
(0.22)
|
|
$
|
(0.32)
|
|
$
|
(0.65)
|
|
$
|
(1.02)
|
|
Gain (loss) from discontinued
operations
|
|
0.36
|
|
|
(0.04)
|
|
|
0.35
|
|
|
(0.09)
|
|
Diluted earnings (loss) per share
|
$
|
0.14
|
|
$
|
(0.36)
|
|
$
|
(0.30)
|
|
$
|
(1.11)
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
15,553,097
|
|
|
11.293,895
|
|
|
15,034,841
|
|
|
10,765,931
|
|
Diluted
|
|
15,553,097
|
|
|
11,293,895
|
|
|
15,034,841
|
|
|
10,765,931
|
You On Demand Holdings, Inc. and Its
Subsidiaries
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
2013
|
|
2012
|
|
(Unaudited)
|
|
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
$
|
1,214,490
|
|
$
|
3,277,891
|
Marketable equity securities, available for
sale
|
|
1,714
|
|
|
2,229
|
Accounts receivable, net
|
|
111,943
|
|
|
-
|
Licensed content, current
|
|
737,017
|
|
|
681,457
|
Prepaid expenses
|
|
279,452
|
|
|
412,669
|
Note receivable, sale of Jinan
Broadband
|
|
3,911,088
|
|
|
-
|
Other current assets
|
|
4,684
|
|
|
135,486
|
Current assets of discontinued
operations
|
|
-
|
|
|
1,498,852
|
Total current assets
|
|
6,260,388
|
|
|
6,008,584
|
|
|
|
|
|
|
Property and equipment, net
|
|
566,877
|
|
|
729,763
|
Licensed content, noncurrent
|
|
200,227
|
|
|
530,367
|
Intangible assets, net
|
|
2,705,635
|
|
|
3,416,858
|
Goodwill
|
|
6,105,478
|
|
|
6,105,478
|
Investment in unconsolidated
entities
|
|
681,304
|
|
|
655,834
|
Non-current assets of discontinued
operations
|
|
-
|
|
|
5,011,161
|
Total assets
|
$
|
16,519,909
|
|
$
|
22,458,045
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
$
|
1,575,448
|
|
$
|
885,366
|
Accrued expenses and liabilities
|
|
1,161,910
|
|
|
953,134
|
Deferred license fees, current
|
|
988,401
|
|
|
-
|
Other Current liabilities
|
|
36,429
|
|
|
708,367
|
Contingent purchase price consideration liability,
current
|
|
426,124
|
|
|
368,628
|
Convertible promissory note
|
|
3,000,000
|
|
|
3,000,000
|
Warrant liabilities
|
|
915,510
|
|
|
878,380
|
Current liabilities of discontinued
operations
|
|
-
|
|
|
5,197,450
|
Total current liabilities
|
|
8,103,822
|
|
|
11,991,325
|
|
|
|
|
|
|
Deferred license fees, concurrent
|
|
-
|
|
|
460,547
|
Contingent purchase price consideration
liability
|
|
-
|
|
|
368,628
|
Deferred tax liability
|
|
154,946
|
|
|
237,075
|
Non-current liabilities of discontinued
operations
|
|
-
|
|
|
68,774
|
Total liabilities
|
|
8,258,768
|
|
|
13,126,349
|
|
|
|
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Convertible redeemable preferred stock, $.001 par
value; 50,000,000 shares
authorize
|
|
|
|
|
|
Series A - 7,000,000 shares issued and outstanding,
liquidation preference of $3,500,000 at September 30, 2013 and
December 31, 2012, respectively
|
|
1,261,995
|
|
|
1,261,995
|
Series B - 0 and 7,866,800 shares issued and
outstanding, liquidation preference of $0 and $3,933,400 at
September 30, 2013 and December 31, 2012,
respectively
|
|
-
|
|
|
3,223,575
|
Series C - 87,500 and 250, 00 shares issued and
outstanding, liquidation preference of $350,000 and $1,000,000 at
September 30, 2013 and December 31, 2012,
respectively
|
|
219,754
|
|
|
627,868
|
Series D 4% - 2,285,714 and 0 shares issued and
outstanding, liquidation preference of $4,000,000 and $0 at
September 30, 2013 and December 31, 2012
|
|
3,711,794
|
|
|
-
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, $.001 par value; 1500,000,000 shares
authorized, 15,793,314 and 13,742,394 shares issued at September
30, 2013 and December 31, 2012, respectively
|
|
15,793
|
|
|
13,742
|
Additional paid-in capital
|
|
67,438,268
|
|
|
62,388,502
|
Accumulated deficit
|
|
(62,477,818)
|
|
|
(58,841,664)
|
Accumulated other comprehensive (loss)
income
|
|
(737,100)
|
|
|
604,632
|
Total YOU On Demand equity
|
|
4,239,143
|
|
|
4,165,212
|
Non-controlling interest
|
|
(1,171,545)
|
|
|
53,046
|
|
|
|
|
|
|
Total equity
|
|
3,067,598
|
|
|
4,218,258
|
Total liabilities and equity
|
$
|
16,519,909
|
|
$
|
22,458,045
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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SOURCE YOU On Demand Holdings, Inc.