SANTA MONICA, Calif.,
Nov. 14, 2014 /PRNewswire/ --
Rightscorp (OTCQB: RIHT), the leading provider of monetization
services for artists and holders of copyrighted Intellectual
Property (IP), today announced financial results for the third
quarter of 2014 ended September 30,
2014.
Financial Highlights:
- Company increased revenues due to growth in copyrights, ISP
participation, and settlements closed;
- 282% increase in revenues to $248,387 for the third quarter ended September 30, 2014, from $64,949 for the same period in 2013;
- 313% increase in revenues to $688,801 for the nine months ended September 30, 2014 from $166,875 for the same period of 2013. Revenues
for first nine months 2014 have already significantly exceeded full
year 2013; and
- Balance sheet improvements include a material increase in cash
and cash equivalents of $2,646,388 on
September 30, 2014 from $36,331 on December 31,
2013. The increases in cash and other fixed assets resulted
in growth of total assets of $3,129,154 on September
30, 2014 from $146,223 on
December 31, 2013.
Operational Highlights:
- Closed $2.65 million in private
equity financing led by institutional investors to accelerate
expansion in automation, increase ingestion of content, propel
growth trend, and bring Company towards
profitability;
- Increased Internet Service Providers (ISPs) participation to
over 140, covering an estimated 15% of homes in the U.S.;
- Reported 130,000 copyright infringement cases closed as of
September 30, 2014, up from 75,000
for Q2 representing an approximate 73% increase;
- Expanded representation into the music market, secured
representation agreement with Bicycle Music Company, and open
discussions with other companies in different sectors; and
- Appointed Chief Operating Officer Robert Steele as President and named
Brett M. Johnson as Chairman of the
Board.
Robert Steele, Rightscorp
President and COO commented, "We generated an impressive 282%
increase in revenues this quarter. This was driven by an increase
in the number of copyrights ingested into our system from
approximately 21,000 on September 30,
2013 to approximately 160,000 on September 30, 2014. Quarter over quarter
growth was relatively flat due to the demands on our computer
systems as the increase in copyrights ingested exceeded their
capacity. The additional financing we recently closed will
provide additional equipment and bandwidth to meet these
demands."
Rightscorp CEO Christopher Sabec, added, "In the third quarter,
we grew our operational metrics and expanded our representation of
copyrights. Our proprietary technology has only begun impacting the
industry and we have secured deals with The Royalty Network and the
Bicycle Company. Our year-over-year growth figures are indicative
of the strength in our business and we are proud to report that in
the nine months ended September 30,
2014, we have already exceeded what we generated for the
full year in 2013 by more than 100%. Also, during the quarter, we
reported having thirty patents pending worldwide to identify,
monitor, and monetize peer-to-peer copyright infringement and
believe we have the strongest and most effective solution in
combating illegal file sharing. We are very encouraged by the
opportunities we've generated thus far and believe we offer a very
compelling investment proposition to our investors."
Third Quarter 2014 Financial Summary
For the third quarter of 2014 ended September 30, 2014, the Company generated total
revenues of $248,387, an increase of
$183,438 or 282% from $64,949 in the same period in 2013.
For the third quarter of 2014, operating expenses totaled
$1,052,115, compared to $525,545 for prior-year quarter. The increase in
fees was due to payroll expenses and fees paid to copyright holders
in the period. General and administrative expenses were
$896,098 for the quarter ended
September 30, 2014 compared to
$459,821 for the year-ago quarter,
due to increased wages, professional and investment banking fees,
and travel and other expenses related to securing financing.
Sales and marketing costs were $16,872 for the third quarter of 2014, from
$25,242 for the third quarter of
2013, a decrease of $8,370.
Depreciation and amortization expenses were $14,951 during the quarter ended September 30, 2014, an increase of $6,941 as compared to $8,010 in the year-ago quarter.
Other expense totaled $150,328
during the three months ended September 30,
2014, an increase from $72,519 from the three months ended September 30, 2013, due to decreased interest
owed on convertible notes used to finance operations.
During the three months ended September
30, 2014, the Company recorded a net loss of $653,400 or $(0.01)
compared to $533,115, or $(0.01) for the three months ended September 30, 2013.
Nine Months ended September 30,
2014
For the nine months ended September 30,
2014, Rightscorp reported $688,801 in revenues, an increase of $521,926 or 313% over revenues from $166,875 for the same period in 2013. This
increase in revenue was driven by an increase in the number of
copyrights ingested into the system for which the Company has
contracts to monitor for infringements, from approximately 21,000
on September 30, 2013 to
approximately 160,000 on September 30,
2014.
Rightscorp incurred operating expenses of $2,876,584 during the nine months ended
September 30, 2014, as compared to
$1,282,629 for the nine months ended
September 30, 2013. This increase was
due to increased payroll expenses and fees paid to copyright
holders in the period. General and administrative expenses
were $2,420,447 for the period ended
September 30, 2014, compared to
$1,107,682 for the nine months ended
September 30, 2013, due to increased
wages expenses, professional and investment banking fees, and
travel and other expenses related to securing financing.
Sales and marketing costs were $72,428 for the period ended September 30, 2014 compared to $67,960 for the nine months ended September 30, 2013, an increase of $4,468 due to increased presence at industry
conferences to meet potential clients.
Depreciation and amortization expenses were $39,308 during the nine months ended September 30, 2014, an increase of $15,756 as compared to $23,552 for the nine months ended September 30, 2013. Other expenses totaled
$129,102 during the nine months ended
September 30, 2014.
Net loss attributable to common shareholders was $2,058,681, or $(0.03) compared to $1,328,410 or $(0.02) for the nine months ended September 30, 2013.
At September 30, 2014, the Company
had cash and cash equivalents of $2,646,388.
Conference call information:
Date: Friday, November 14,
2014
Time: 4:15 P.M. Eastern Time
(ET)
Dial in Number for U.S. & Canadian Callers: 877-407-9129
Dial in Number for International Callers (Outside of the U.S. &
Canada): 201-493-6753
Participating on the call will be Rightscorp Chief Executive
Officer Christopher Sabec and Chief Operating Officer Robert Steele, who will discuss operational and
financial highlights for the third quarter of 2014.
To join the live conference call, please dial into the above
referenced telephone numbers five to ten minutes prior to the
scheduled conference call time. A live webcast and archive of the
call will also be available on Rightscorp's website at:
http://rightscorp.equisolvewebcast.com/q3-2014.
A replay will be available for 14 days starting on November 14, 2014 at approximately 8:00 P.M. (ET). To access the replay, please dial
1-877-660-6853 in the U.S. and 1-201-612-7415 for international
callers. The conference ID# is 418309.
About Rightscorp, Inc.
Rightscorp (OTCQB: RIHT) is a leading provider of monetization
services for artists and holders of copyrighted Intellectual
Property (IP). The Company's patent pending digital loss prevention
technology focuses on the infringement of digital content such as
music, movies, software, books, and games and ensures that owners
and creators are rightfully paid for their IP. Rightscorp
implements existing laws to solve copyright infringements by
collecting payments from illegal file sharing activities via
notifications sent through Internet Service Providers (ISPs).
The Company's technology identifies copyright infringers, who are
offered a reasonable settlement option when compared to the legal
liability defined in the Digital Millennium Copyrights Act (DMCA).
Based on the fact that 22% of all Internet traffic is used to
distribute copyrighted content without permission or compensation
to the creators, Rightscorp is pursuing an estimated $2.3 billion
opportunity and has monetized major media titles through
relationships with industry leaders.
http://www.rightscorp.com/
Safe Harbor Statement
This press release may include forward-looking statements. All
statements other than statements of historical fact included in
this press release, including, without limitation, statements
regarding the Company's anticipated financial position, business
strategy and plans and objectives of management of the Company for
future operations, are forward-looking statements. When used in
this press release, words such as "anticipate," "believe,"
"estimate," "expect," "intend," and similar expressions, as they
relate to the Company or its management, identify forward-looking
statements. Such forward-looking statements are based on the
beliefs of the Company's management as well as assumptions made by
and information currently available to the Company's management.
Actual results could differ materially from those contemplated by
the forward-looking statements as a result of certain factors not
limited to, general economic and business conditions, competitive
factors, changes in business strategy or development plans, the
ability to attract and retain qualified personnel, and changes in
legal and regulatory requirements. Such forward-looking statements
reflect the current views of the Company with respect to future
events and are subject to these and other risks, uncertainties and
assumptions relating to the operations, results of operations,
growth strategy and liquidity of the Company. All subsequent
written and oral forward-looking statements attributable to the
Company or persons acting on its behalf are expressly qualified in
their entirety by this paragraph.
For further investor and media information
contact:
Andrew Haag
Managing Partner
IRTH Communications
rightscorp@irthcommunications.com
1-866-976-4784
[Financial Tables to Follow]
|
|
Rightscorp,
Inc.
|
Consolidated
Statements of Operations
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Revenue
|
$248,387
|
|
$64,949
|
|
$688,801
|
|
$166,875
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Copyright holder
fees
|
124,194
|
|
32,472
|
|
344,401
|
|
83,435
|
General and
administrative
|
896,098
|
|
459,821
|
|
2,420,447
|
|
1,107,682
|
Sales and
marketing
|
16,872
|
|
25,242
|
|
72,428
|
|
67,960
|
Depreciation and
amortization
|
14,951
|
|
8,010
|
|
39,308
|
|
23,552
|
Total operating
expenses
|
1,052,115
|
|
525,545
|
|
2,876,584
|
|
1,282,629
|
|
|
|
|
|
|
|
|
Loss from
operations
|
(803,728)
|
|
(460,596)
|
|
(2,187,783)
|
|
(1,115,754)
|
|
|
|
|
|
|
|
|
Other
expenses:
|
|
|
|
|
|
|
|
Interest
expense
|
(5,009)
|
|
(72,519)
|
|
(26,235)
|
|
(212,656)
|
Gain on
Settlements
|
169,950
|
|
-
|
|
169,950
|
|
-
|
Loss on
derivative liability
|
(14,613)
|
|
-
|
|
(14,613)
|
|
-
|
Total other
expenses
|
150,328
|
|
(72,519)
|
|
129,102
|
|
(212,656)
|
|
|
|
|
|
|
|
|
Loss from
operations before income taxes
|
(653,400)
|
|
(533,115)
|
|
(2,058,681)
|
|
(1,328,410)
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
Net
loss
|
$(653,400)
|
|
$(533,115)
|
|
$(2,058,681)
|
|
$(1,328,410)
|
|
|
|
|
|
|
|
|
Net loss per share
– basic and diluted
|
(0.01)
|
|
$(0.01)
|
|
(0.03)
|
|
(0.02)
|
|
|
|
|
|
|
|
|
Weighted average
common shares – basic and diluted
|
77,246,760
|
|
60,513,010
|
|
72,792,882
|
|
60,284,914
|
|
|
Rightscorp,
Inc.
|
Consolidated Balance
Sheets
|
(Unaudited)
|
|
|
September
30,
|
|
December
31,
|
Assets
|
2014
|
|
2013
|
Assets
|
(Unaudited)
|
|
|
Cash
|
$2,646,388
|
|
$36,331
|
Prepaid
expenses
|
355,316
|
|
19,639
|
Total Current
Assets
|
3,001,704
|
|
55,970
|
Other
Assets
|
|
|
|
Fixed assets,
net
|
106,325
|
|
56,453
|
Intangible assets,
net
|
21,125
|
|
33,800
|
Total
Assets
|
$3,129,154
|
|
$146,223
|
|
|
|
|
Liabilities and
Stockholders' Deficit
|
|
|
|
Current
Liabilities:
|
|
|
|
Accounts payable and
accrued liabilities
|
$455,058
|
|
$928,304
|
Convertible notes
payable, net of discount of $100 and $10,891
|
60,000
|
|
202,609
|
Derivative liability
|
3,698,197
|
|
-
|
Total Current
Liabilities
|
4,213,255
|
|
1,130,913
|
Total
Liabilities
|
4,213,255
|
|
1,130,913
|
|
|
|
|
Stockholders'
Deficit:
|
|
|
|
Preferred stock, $.001
par value; 10,000,000 shares authorized; null shares issued and
outstanding
|
-
|
|
-
|
Common stock, $.001
par value; 250,000,000 shares authorized; 90,171,469 and 68,797,102
shares issued and outstanding, respectively
|
90,171
|
|
68,797
|
Common stock to be
issued
|
-
|
|
380,000
|
Stock subscription
payable
|
(250,000)
|
|
-
|
Additional paid in
capital
|
5,375,081
|
|
2,807,185
|
Accumulated
deficit
|
(6,299,353)
|
|
(4,240,672)
|
Total stockholders'
deficit
|
1,084,101
|
|
(984,690)
|
Total Liabilities
and Stockholders' Deficit
|
$3,129,154
|
|
$146,223
|
SOURCE Rightscorp, Inc.