Conference Call
Scheduled Today at 4:30 p.m. Eastern
NEW YORK - November 9, 2016 - FORM
Holdings Corp. (NASDAQ: FH), a diversified holding company focused
on acquiring, investing in and developing small to mid-market
businesses, today announced operating results for the quarter ended
September 30, 2016 in its Quarterly Report on Form 10-Q filed with
the Securities and Exchange Commission as well as provided an
update on the acquisition of XpresSpa and other ongoing
operations.
XpresSpa
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XpresSpa provides air travellers with
premium health and wellness services, as well as a branded line of
exclusive luxury travel products and accessories at its 51
locations across 21 major airports in three countries. During the
third quarter of 2016, XpresSpa announced that it opened its fourth
spa location at the Dallas/Fort Worth International Airport (DFW)
in Texas and its first spa location at the Dubai International
Airport (DXB) in the United Arab Emirates. The company's pipeline
of RFP's and new store openings remains strong with four new stores
planned for the remainder of the year and an additional two for Q1
2017.
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On August 8, 2016, we entered into a
definitive agreement to acquire 100% of XpresSpa. The transaction,
which has been approved by FORM Holdings' and XpresSpa's respective
Boards of Directors, is subject to closing conditions and approval
by the FORM Holdings stockholders at our annual meeting, which is
scheduled for November 28, 2016. We expect to close the acquisition
immediately after the stockholders meeting.
During the nine months ended
September 30, 2016, XpresSpa generated over $32.4 million of
revenue compared to $29.2 million of revenue in the nine months
ended September 30, 2015. During the third quarter of 2016 the
company generated $11.9 million of revenue compared to $10.3
million in the third quarter of 2015.
Operating Results for the Quarter
Ended September 30, 2016
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We generated total revenue of $16.5 million YTD
2016 and $3.1 million for the quarter ended September 30, 2016
compared to $0.2 million YTD 2015 and no revenue generated for the
quarter ended September 30, 2015.
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Excluding non-cash expenses, the net operating
loss was $3.2 million YTD 2016 and $3.1 million for the quarter
ended September 2016. In the prior year, net operating loss,
excluding non-cash expenses, was approximately $18.4 million YTD
2015 and $7.8 million for the quarter ended September 30, 2015. The
non-cash expenses were primarily related to stock-based
compensation and amortization and impairment of intangible assets
related to the Company's intellectual property segment.
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Our Group Mobile operating segment
generated $5.5 million of revenue YTD 2016 and $1.8 million of
revenue for the quarter ended September 30, 2016, with the third
quarter seasonally the slowest sales quarter of the year. In the
five weeks since the quarter end, we have received orders in excess
of $2.1 million of products and services and we continue to guide
for 2016 revenues of $12.5 million, which represents an approximate
135% increase over total revenues of $5.3 million in fiscal
2015. We anticipate that the rate of orders will increase as
we move through the fourth quarter, which is the largest ordering
period for many of our customers. In addition, the third quarter
saw the launch of our partnerships and offerings for body-worn
video as well as our services offering, both of which will
represent higher margin and recurring revenues as we move into
2017.
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Our FLI Charge operating segment launched its
consumer product line on Indiegogo, a crowdfunding platform, on
June 15, 2016, and has generated approximately $225,000 of
pre-sales in the form of orders, ranking FLI Charge's campaign in
the top 400, or the top one-tenth of one percent, of the more than
550,000 campaigns that have launched on Indiegogo since its
inception. Tooling for FLI Charge's product line is complete and
manufacturing inventory is underway. FLI Charge will be fulfilling
pre-orders in November 2016. In addition we have signed an MOU with
Papp Plastics, a tier-1 auto parts manufacturer. During the fourth
quarter of 2016, FLI Charge's management team has been focused on
expanding the distribution of its consumer products and generating
additional licenses in addition to those that it already has in the
automotive, education and hospitality markets.
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Our Intellectual Property operating segment
generated $11.0 million of revenue YTD 2016 and $1.4 million of
revenue during the quarter ended September 30, 2016. The revenue
was derived from one-time licensing payments from several
licensees.
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As of September 30, 2016, we had approximately
$26.0 million of current assets, of which $21.7 million was cash,
compared to $28.4 million of current assets as of June 30, 2016, of
which $27.4 was cash. The change in net current assets is partially
driven by cash used in exercising an early repayment option of a
pre-existing note in the amount of $2.0 million. We do not have any
outstanding debt as of September 30, 2016.
Conference
Call
The Company will host a conference
call today at 4:30 p.m., Eastern Time, to discuss operating results
for the third quarter of 2016 as well as provide updates on each of
the Company's business segments and the acquisition of XpresSpa.
Members of the Company's management team, including Andrew D.
Perlman, Chief Executive Officer, Anastasia Nyrkovskaya, Chief
Financial Officer, and Clifford J. Weinstein, Executive Vice
President and President of FLI Charge, as well as Darin White,
President of Group Mobile, and Ed Jankowski, CEO of XpresSpa, will
participate.
Join the
Conference Call via Webcast
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Visit http://bit.ly/2eN2xfZ before the
start time to join the web portion of this event.
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Enter your First Name, Last Name,
Company, and Email Address and select "Submit".
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Select the "Launch Webcast" icon to
view the event.
Join the
Conference Call via Assisted Dial-In
To access the conference call by
telephone, interested parties should dial (866) 682-6100 (U.S. and
Canada) or (862) 255-5401 (international) and reference FORM
Holdings.
Replay
An audio webcast of the conference
call will be available within the "Presentations" section of FORM
Holdings' investor relations website shortly after the end of the
conference call.
About FORM
Holdings Corp.
FORM Holdings Corp. (NASDAQ: FH)
is a publicly held diversified holding company that specializes in
identifying, investing in and developing companies with superior
growth potential. FORM's current holdings include Group Mobile, FLI
Charge, Infomedia and intellectual property assets. Group Mobile is
a provider of rugged, mobile and field-use computing products,
serving customers worldwide. FLI Charge designs, develops,
licenses, manufactures and markets wireless conductive power and
charging solutions. Infomedia is a leading provider of customer
relationship management and monetization technologies to mobile
carriers and device manufacturers. FORM Holdings' intellectual
property division is engaged in the development and monetization of
intellectual property. To learn more about Form Holdings Corp.,
visit: www.FormHoldings.com.
Forward-Looking
Statements
This press release includes
forward-looking statements, which may be identified by words such
as "believes," "expects," "anticipates," "estimates," "projects,"
"intends," "should," "seeks," "future," "continue," or the negative
of such terms, or other comparable terminology. Forward-looking
statements are statements that are not historical facts. Such
forward-looking statements are subject to risks and uncertainties,
which could cause actual results to differ materially from the
forward-looking statements contained herein. Statements in this
press release regarding the proposed merger between FORM and
XpresSpa; the expected timetable for completing the transaction;
the potential value created by the proposed merger for FORM's
stockholders and XpresSpa's equity holders; the potential of FORM's
business after completion of the merger; XpresSpa's projected
revenue, the ability to raise capital to fund operations and
business plan; the continued listing of FORM's securities on the
Nasdaq Capital Market; the potential impact on FORM's common stock
if FORM determines to repay the preferred stock to be issued in
connection with the proposed merger in stock rather than cash;
market acceptance of FORM products; the collective ability to
protect intellectual property rights; competition from other
providers and products; FORM's management and board of directors
after completion of the Merger; and any other statements about
FORM's or XpresSpa's management teams' future expectations,
beliefs, goals, plans or prospects constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. There are a number of important factors that
could cause actual results or events to differ materially from
those indicated by such forward-looking statements, including, but
not limited to: the risk that FORM and XpresSpa may not be able to
complete the proposed transaction; the inability to realize the
potential value created by the proposed merger for FORM's
stockholders; FORM's inability to maintain the listing of its
securities on the Nasdaq Capital Market after completion of the
merger; the potential lack of market acceptance of FORM's products;
FORM's inability to monetize and recoup FORM's investment with
respect to assets and other businesses that that were acquired or
will be acquired in the future; general economic conditions and
level of information technology and consumer electronics spending;
unexpected trends in the mobile phone and telecom computing
industries; the potential loss of one or more of FORM's significant
Original Equipment Manufacturer ("OEM") suppliers, the potential
lack of market acceptance of FORM's products; market acceptance,
quality, pricing, availability and useful life of FORM's products
and services, as well as the mix of FORM's products and services
sold; potential competition from other providers and products;
FORM's inability to license and monetize FORM's patents, including
the outcome of litigation; FORM's inability to develop and
introduce new products and/or develop new intellectual property;
FORM's inability to protect FORM's intellectual property rights;
new legislation, regulations or court rulings related to enforcing
patents, that could harm FORM's business and operating results;
FORM's inability to retain key members of its management team; and
other risks and uncertainties and other factors discussed from time
to time in our filings with the Securities and Exchange Commission
("SEC"), including FORM's Annual Report on Form 10-K for the year
ended December 31, 2015 filed with the SEC on March 10, 2016.
Investors and stockholders are also urged to read the risk factors
set forth in the proxy statement/prospectus carefully when they are
available. FORM expressly disclaims any obligation to publicly
update any forward-looking statements contained herein, whether as
a result of new information, future events or otherwise, except as
required by law.
Important
Additional Information Filed with the SEC
This communication does not
constitute an offer to sell or the solicitation of an offer to buy
any securities of FORM, or XpresSpa or the solicitation of any vote
or approval. In connection with the proposed transaction, FORM
filed a Registration Statement on Form S-4, as amended, declared
effective by the SEC on October 27, 2016 and a final proxy
statement/prospectus on October 28, 2016. The proxy
statement/prospectus contains important information about FORM,
XpresSpa, the transaction and related matters. FORM has mailed or
otherwise delivered the proxy statement/prospectus to its
stockholders and the stockholders of XpresSpa. Investors and
security holders of FORM and XpresSpa are urged to read carefully
the proxy statement/prospectus relating to the Merger (including
any amendments or supplements thereto) in its entirety, because it
contains important information about the proposed transaction.
Investors and security holders of
FORM are able to obtain free copies of the proxy
statement/prospectus for the proposed Merger and other documents
filed with the SEC by FORM through the website maintained by the
SEC at www.sec.gov.
FORM and XpresSpa, and their
respective directors and certain of their executive officers, may
be deemed to be participants in the solicitation of proxies in
respect of the transactions contemplated by the Merger Agreement
between FORM and XpresSpa. Information regarding FORM's directors
and executive officers is contained in the proxy
statement/prospectus. Information regarding XpresSpa's directors
and officers and a more complete description of the interests of
XpresSpa's directors and officers in the proposed transaction is
available in the proxy statement/prospectus filed by FORM with the
SEC in connection with the proposed transaction.
Contacts
FORM Holdings
212-309-7549
info@FORMHoldings.com
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: FORM Holdings Corp. via Globenewswire
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