Tix Corporation (the "Company") (OTCQX: TIXC), a leading provider
of discount ticketing services, today reported results for the
second quarter and first six months ended June 30, 2013.
Tix Corporation's business is operated by its wholly owned
subsidiary Tix4Tonight, which sells discount show tickets from
eleven locations in Las Vegas. Tix4Tonight obtains its inventory of
discount tickets under short-term exclusive and non-exclusive
agreements with nearly every Las Vegas show along with numerous
attractions and tours. The majority of our discount ticket
locations also offer discount dinner reservations at various
restaurants surrounding the Las Vegas strip and downtown.
Three Months Ended June 30, 2013 and
2012
Second quarter 2013 revenues decreased 17% to $5.2 million
compared with $6.2 million for the same period a year ago. The
decline in revenues of $1.0 million was caused by large scale
construction and renovation projects on the Las Vegas strip
requiring us to close two of our discount ticket locations; one in
April 2012 and another in February 2013. Revenues were also
negatively impacted by the continued general decrease in consumer
spending in Las Vegas.
Second quarter 2013 direct operating expenses decreased 17% to
$2.1 million compared with $2.6 million for the same period a year
ago. Included in these expenses are payroll costs, rents, and
utilities. The decrease in expense of $439,000 was due to $169,000
in reduced rents and utilities expense and $125,000 in reduced
payroll costs realized in connection with the closure of two of our
discount ticket locations as discussed above, and $145,000 in
reduced rents at one of our discount ticket locations in the second
half of calendar year 2012.
Second quarter 2013 selling, general and administrative expenses
were $2.1 million compared with $2.7 million for the same period a
year ago. Included in these expenses are $220,000 of aggregate
expenses during the first three months of 2013 and $532,000 of
aggregate expenses during the same period a year ago, in each case
relating to expenses for certain non-recurring matters requiring
legal and advisory services relating to corporate and governance
matters and litigation expenses. Excluding these expenses, selling,
general and administrative expenses decreased $208,000, or 10%, to
$1.9 million compared to $2.1 million for the same period of the
prior year. The decrease in expenses of $208,000 was realized in
connection with the closure of two of our discount ticket locations
as discussed above and our continual efforts to manage our overall
expenses.
Second quarter 2013 net income was $579,000, or $0.02 per
diluted common share, as compared to a net income of $95,000, or
$0.00 per diluted common share, reported for the same period a year
ago. Adjusted Earnings (as defined and explained below) for the
second quarter 2013, which includes adjustments for items such as
discontinued operations and expenses related to litigation and
related legal matters described below, was $1.4 million, or $0.06
per diluted common share, as compared to Adjusted Earnings of $1.8
million, or $0.07 per diluted common share, reported for the same
period a year ago.
Six Months Ended June 30, 2013 and
2012
For the first six months of 2013, revenues decreased 13% to
$10.4 million compared with $12.1 million for the same period a
year ago. The decline in revenues of $1.6 million was caused by
large scale construction and renovation projects on the Las Vegas
strip requiring us to close two of our discount ticket locations;
one in April 2012 and another in February 2013. Revenues were also
negatively impacted by the continued general decrease in consumer
spending in Las Vegas.
For the first six months of 2013, direct operating expenses
decreased 17% to $4.5 million compared with $5.4 million for the
same period a year ago. The decrease in expense of $906,000 was due
to $301,000 in reduced rents and utilities expense and $315,000 in
reduced payroll costs realized in connection with the closure of
two of our discount ticket locations as discussed above, and
$290,000 in reduced rents at one of our discount ticket locations
in the second half of calendar year 2012.
For the first six months of 2013, selling, general and
administrative expenses were $4.5 million compared with $5.6
million for the same period a year ago. Included in these expenses
are $620,000 of aggregate expenses during the first six months of
2013 and $1.4 million of aggregate expenses during the same period
a year ago, in each case relating to expenses for certain
non-recurring matters requiring legal and advisory services
relating to corporate and governance matters and litigation
expenses. Excluding these expenses, selling, general and
administrative expenses decreased $317,000, or 8%, to $3.9 million
compared to $4.2 million for the same period of the prior year. The
decrease in expenses of $317,000 was realized in connection with
the closure of two of our discount ticket locations as discussed
above and our continual efforts to manage our overall expenses.
For the first six months of 2013, net income was $816,000, or
$0.03 per diluted common share, as compared to a net loss of
($200,000), or ($0.01) per diluted common share, reported for the
same period a year ago. Adjusted Earnings (as defined and explained
below) for the first six months of 2013, which includes adjustments
for items such as discontinued operations and expenses related to
litigation and related legal matters described below, was $2.6
million, or $0.11 per diluted common share, as compared to Adjusted
Earnings of $3.0 million, or $0.13 per diluted common share,
reported for the same period a year ago.
Conclusion
Mitch Francis, Chief Executive Officer of the Company, stated,
"We opened two new locations during July and August of 2013. These
locations are placed at highly trafficked pedestrian walkways and
intersections and we are hopeful that these new locations will
counter the negative impact during the first half of 2013 resulting
from the closure of one of our locations in April 2012 and more
recently, one of our major locations in February 2013, caused by
large scale construction and renovation projects in Las Vegas. We
are hopeful that consumer spending in Las Vegas will improve and
that with these two new locations, our future revenues will
improve."
Investor Conference Call
The Company does not host a conference call following its
earnings release. Investors are encouraged to contact the Company's
investor relations officer, Steve Handy, CFO, at (818) 761-1002
with any questions.
Non-GAAP Financial Measure
Included in this press release is a "non-GAAP financial
measure," which is a measure of the Company's historical or future
performance that is different from measures calculated and
presented in accordance with GAAP but that the Company believes is
useful to investors. The Company defines Adjusted Earnings as net
income plus (a) loss on discontinued operations, (b) interest
expense, net, (c) income taxes, (d) depreciation and amortization
charges, (e) stock based compensation expense (f) unusual
litigation, and (g) expenses for certain non-recurring matters
requiring legal and advisory services relating to corporate and
governance matters. The Company believes that Adjusted Earnings is
a useful measure of the Company's operating performance because a
significant portion of its assets consists of goodwill and
intangible assets and property and equipment that are amortized and
depreciated as non-cash items over their remaining useful lives in
accordance with GAAP. The Company's presentation of Adjusted
Earnings may help investors assess the Company's performance before
the effect of various items that do not directly affect the
Company's ongoing operating performance. The Company also believes
that measures similar to the Company's measurement of Adjusted
Earnings are widely used in similar entertainment companies to
measure operating performance, although Adjusted Earnings as
calculated by the Company is not necessarily comparable to
similarly titled measures by such other companies. Adjusted
Earnings (a) does not represent net income or cash flows from
operations as defined by GAAP, (b) is not necessarily indicative of
cash available to fund the Company's cash flow needs, and (c)
should not be considered as an alternative to net income, operating
income, cash flows from operating activities or the Company's other
financial information as determined under GAAP.
About Tix Corporation
Tix Corporation (OTCQX: TIXC) provides discount ticketing
services. It currently operates eleven discount ticket stores in
Las Vegas under its Tix4Tonight marquee, which offers up to a 50
percent discount for same-day shows, concerts, attractions and
sporting events, as well as discount reservations for dining.
Safe Harbor Statement
Except for the historical information contained herein, certain
matters discussed in this press release are forward-looking
statements which involve risks and uncertainties. Forward-looking
statements include, but are not limited to, statements about the
expected opening dates of, and operations and sales at, each of the
two new locations discussed herein, potential improvements in
consumer spending in Las Vegas, and our future revenues and
financial position. These forward-looking statements are based on
expectations and assumptions as of the date of this press release
and are subject to numerous risks and uncertainties which could
cause actual results to differ materially from those described in
the forward-looking statements. These risks and uncertainties are
discussed in the Company's various historical filings with the
Securities and Exchange Commission and, since November 2010, the
Company's filings with the OTCQX. The Company assumes no obligation
to update these forward-looking statements. A copy of the Company's
reports for the twelve months ended December 31, 2012 and the three
and six months ended June 30, 2013 can be found on the Company
website at www.tixcorp.com or at www.otcqx.com.
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2013 2012
------------- -------------
(Unaudited)
Assets
Current assets:
Cash $ 6,471,000 $ 6,017,000
Short-term investments 3,005,000 2,993,000
Accounts receivable 33,000 45,000
Prepaid expenses and other current assets 219,000 419,000
------------- -------------
Total current assets 9,728,000 9,474,000
------------- -------------
Property and equipment, net 1,049,000 1,047,000
------------- -------------
Other assets:
Intangible assets:
Goodwill 3,120,000 3,120,000
Intangibles, net 752,000 1,006,000
------------- -------------
Total intangible assets 3,872,000 4,126,000
Deposits and other assets 151,000 187,000
------------- -------------
Total other assets 4,023,000 4,313,000
------------- -------------
Total assets $ 14,800,000 $ 14,834,000
============= =============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 2,297,000 $ 3,372,000
Deferred revenue 78,000 151,000
Other current liabilities 153,000 156,000
Note payable - short term 176,000 -
Obligation for share purchase - short term 84,000 209,000
------------- -------------
Total current liabilities 2,788,000 3,888,000
Note payable - net of current portion 715,000 879,000
Obligation for share purchases - net of
current portion 160,000 244,000
------------- -------------
Total liabilities 3,663,000 5,011,000
------------- -------------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 500,000
shares authorized; none issued - -
Common Stock, $.08 par value; 100,000,000
shares authorized; 23,669,831 shares net of
9,955,544 treasury shares, and 23,669,831
shares net of 9,955,544 treasury shares
issued and outstanding at June 30, 2013 and
December 31, 2012, respectively 2,691,000 2,691,000
Additional paid-in capital 92,886,000 92,366,000
Obligation for share purchases (2,061,000) (2,032,000)
Cost of shares held in treasury (14,654,000) (14,654,000)
Accumulated deficit (67,716,000) (68,532,000)
Accumulated other comprehensive loss (9,000) (16,000)
------------- -------------
Total stockholders' equity 11,137,000 9,823,000
------------- -------------
Total liabilities and stockholders'
equity $ 14,800,000 $ 14,834,000
============= =============
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended June 30,
----------------------------
2013 2012
------------- -------------
(Unaudited) (Unaudited)
Revenues $ 5,160,000 $ 6,193,000
------------- -------------
Operating expenses:
Direct costs of revenues 2,132,000 2,571,000
Selling, general and administrative
expenses 2,131,000 2,651,000
Depreciation and amortization 269,000 285,000
------------- -------------
Total costs and expenses 4,532,000 5,507,000
------------- -------------
Operating income 628,000 686,000
------------- -------------
Other expense:
Other income 5,000 -
Interest income 5,000 1,000
Interest expense (21,000) (26,000)
------------- -------------
Other expense, net (11,000) (25,000)
------------- -------------
Income from continuing operations before
income tax expense 617,000 661,000
Income tax expense 38,000 41,000
------------- -------------
Income from continuing operations 579,000 620,000
------------- -------------
Discontinued operations:
Loss from operations of discontinued
operations - (281,000)
Loss on sale of discontinued operations - (244,000)
------------- -------------
Loss on discontinued operations - (525,000)
------------- -------------
Net income 579,000 95,000
Other comprehensive income (loss):
Unrealized gain (loss) on available-for-sale
securities 6,000 (7,000)
------------- -------------
Comprehensive income $ 585,000 $ 88,000
============= =============
Net income per common share - continuing
operations
Net income per common share - continuing
operations - basic $ 0.02 $ 0.03
Net income per common share - continuing
operations - diluted $ 0.02 $ 0.03
Net loss per common share - discontinued
operations
Net loss per common share - discontinued
operations - basic $ - $ (0.02)
Net loss per common share - discontinued
operations - diluted $ - $ (0.02)
------------- -------------
Net income per common share
Net income per common share - basic $ 0.02 $ 0.00
============= =============
Net income per common share - basic and
diluted $ 0.02 $ 0.00
============= =============
Weighted average common shares outstanding -
basic 23,669,831 23,669,831
============= =============
Weighted average common shares outstanding -
diluted 23,730,388 24,552,274
============= =============
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(LOSS)
(UNAUDITED)
Six Months Ended June 30,
----------------------------
2013 2012
------------- -------------
(Unaudited) (Unaudited)
Revenues $ 10,443,000 $ 12,061,000
------------- -------------
Operating expenses:
Direct costs of revenues 4,467,000 5,373,000
Selling, general and administrative
expenses 4,524,000 5,628,000
Depreciation and amortization 544,000 584,000
------------- -------------
Total costs and expenses 9,535,000 11,585,000
------------- -------------
Operating income 908,000 476,000
------------- -------------
Other expense:
Other income - 3,000
Interest income 11,000 13,000
Interest expense (27,000) (52,000)
------------- -------------
Other expense, net (16,000) (36,000)
------------- -------------
Income from continuing operations before
income tax expense 892,000 440,000
Income tax expense 76,000 41,000
------------- -------------
Income from continuing operations 816,000 399,000
------------- -------------
Discontinued operations:
Loss from operations of discontinued
operations - (355,000)
Loss on sale of discontinued operations - (244,000)
------------- -------------
Loss on discontinued operations - (599,000)
------------- -------------
Net income (loss) 816,000 (200,000)
Other comprehensive income (loss):
Unrealized income (loss) on available-for-
sale securities 7,000 (9,000)
------------- -------------
Comprehensive income (loss) $ 823,000 $ (209,000)
============= =============
Net income per common share - continuing
operations
Net income per common share - continuing
operations - basic $ 0.03 $ 0.02
Net income per common share - continuing
operations - diluted $ 0.03 $ 0.02
Net loss per common share - discontinued
operations
Net loss per common share - discontinued
operations - basic $ - $ (0.03)
Net loss per common share - discontinued
operations - diluted $ - $ (0.03)
------------- -------------
Net income (loss) per common share
Net income (loss) per common share - basic $ 0.03 $ (0.01)
============= =============
Net income (loss) per common share - basic
and diluted $ 0.03 $ (0.01)
============= =============
Weighted average common shares outstanding -
basic 23,669,831 23,671,190
============= =============
Weighted average common shares outstanding -
diluted 23,726,956 23,671,190
============= =============
TIX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Months Ended June 30,
----------------------------
2013 2012
------------- -------------
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net income (loss) $ 816,000 $ (200,000)
Adjustments to reconcile net income (loss)
to net cash provided by operating
activities:
Loss on discontinued operations - 599,000
Depreciation 290,000 325,000
Non-cash interest 12,000 43,000
Realized loss on available-for-sale
securities arising during the period 15,000 -
Amortization of intangible assets 254,000 259,000
Fair value of options and warrants issued
to employees and directors 494,000 512,000
(Increase) decrease in:
Accounts receivable 12,000 8,000
Prepaid expenses and other assets 236,000 453,000
Increase (decrease) in:
Accounts payable and accrued expenses (1,075,000) (850,000)
Deferred revenue (73,000) 26,000
Other current liabilities (3,000) (3,000)
------------- -------------
Net cash provided by operating
activities from continuing operations 978,000 1,172,000
Net cash provided by operating
activities from discontinued
operations - 103,000
------------- -------------
Net cash provided by operating
activities 978,000 1,275,000
------------- -------------
Cash flows from investing activities:
Purchases of property and equipment (292,000) (244,000)
Purchases of short-term investments, net (20,000) (3,000,000)
------------- -------------
Net cash used in investing
activities (312,000) (3,244,000)
Net cash used in investing activities
from discontinued operations - -
------------- -------------
Net cash used in investing
activities (312,000) (3,244,000)
------------- -------------
Cash flows from financing activities:
Cost of treasury shares, net of fees - (23,000)
Payment of repurchase obligation - (1,182,000)
Repayment of acquisition note - (250,000)
Obligation for share purchases (212,000) (210,000)
------------- -------------
Net cash used in financing
activities (212,000) (1,665,000)
------------- -------------
Net increase (decrease) 454,000 (3,634,000)
------------- -------------
Balance at beginning of period 6,017,000 8,077,000
------------- -------------
Balance at end of period $ 6,471,000 $ 4,443,000
============= =============
RECONCILIATION OF NET INCOME TO ADJUSTED EARNINGS
(UNAUDITED)
The following table set forth a reconciliation of consolidated
net income to consolidated Adjusted Earnings:
Three months ended Three months ended
June 30, 2013 June 30, 2012
------------------ ------------------
(Unaudited) (Unaudited)
Net income $ 579,000 $ 95,000
Loss from discontinued operations - 525,000
Income tax expense 38,000 41,000
Interest expense, net 16,000 25,000
Litigation expense and non-routine
legal and advisory services for
corporate and governance matters 220,000 532,000
Stock based compensation expense 247,000 257,000
Depreciation and amortization 269,000 285,000
------------------ ------------------
Adjusted Earnings $ 1,369,000 $ 1,760,000
================== ==================
Six months ended Six months ended
June 30, 2013 June 30, 2012
------------------ ------------------
(Unaudited) (Unaudited)
Net income (loss) $ 816,000 $ (200,000)
Loss from discontinued operations - 599,000
Income tax expense 76,000 41,000
Interest expense, net 16,000 39,000
Litigation expense and non-routine
legal and advisory services for
corporate and governance matters 620,000 1,407,000
Stock based compensation expense 494,000 512,000
Depreciation and amortization 544,000 584,000
------------------ ------------------
Adjusted Earnings $ 2,566,000 $ 2,982,000
================== ==================
Contact: Steve Handy CFO 818-761-1002
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