Fourth Quarter 2016 Highlights
- Achieved second consecutive quarter of positive adjusted EBITDA
- Strengthened Board of Directors through appointments of former President and CEO of
TiVo Tom Rogers as Chairman of the Board and experienced corporate consultantSteve Zenz as Chairman of the Audit Committee - Applied for listing its common shares for trading on the NASDAQ Capital Market and filed an S-1 Registration Statement with the
SEC to offer its common shares inthe United States
Fourth Quarter 2016 Financial Highlights (All amounts in
- Revenue increased 15% to
$6.1 million from$5.3 million in the fourth quarter of 2015, and decreased 1% from$6.2 million in the third quarter of 2016. The year-over-year increase in revenue was primarily due to contractual changes to the company’s advertising program requiring the company to recognize gross revenues beyond commissions, as well as an increase in advertising fees. - Net loss totaled
$6.3 million compared to net loss of$15.1 million in the fourth quarter of 2015, and net loss of$1.4 million in the third quarter of 2016. AtDecember 31, 2016 , the company performed its annual goodwill impairment analysis and due to the decline of the company’s common share price, a portion of the goodwill related to the Worldnow acquisition was deemed impaired and the company recorded a non-cash goodwill impairment expense of$4.2 million . Excluding this impairment expense, along with one-time fees associated with the company’s NASDAQ listing process, net loss for the fourth quarter of 2016 would have totaled$1.7 million , which is an improvement from a net loss of$2.9 million , excluding impairment expense of$12.2 million in the fourth quarter of 2015. - Adjusted EBITDA improved to
$104,000 from an adjusted EBITDA loss of$1.1 million in the fourth quarter of 2015, and decreased from adjusted EBITDA of$335,000 in the third quarter of 2016 (see discussion about the presentation of adjusted EBITDA below). - The company had
$6.7 million in cash and restricted cash atDecember 31, 2016 .
Full Year 2016 Financial Highlights (All amounts in
- Revenue was
$22.8 million compared to$6.9 million in 2015. The increase was primarily due to the acquisition of Worldnow completed inAugust 2015 . - Net loss totaled
$10.7 million , compared to a net loss of$24.8 million in 2015. The improvement resulted primarily from the$8.9 million improvement in adjusted EBITDA noted above, in addition to an$8.0 million reduction to impairment expense. - Adjusted EBITDA improved to
$335,000 compared to an adjusted EBITDA loss of$8.6 million in 2015 (see discussion about the presentation of adjusted EBITDA below).
Management Commentary
“Q4 marked another strong quarter for Frankly, solidifying our new quarterly revenue baseline, which we first achieved in Q3,” said Frankly CEO
“Operationally, we continued to reduce non-essential costs and realize efficiencies, which not only improved our bottom line, but also allowed us to achieve the first full year of positive adjusted EBITDA in our company’s history. We also made significant progress executing on our operational plan, securing several new customer wins and deployments such as Heartland Media, which we expect to start generating revenue in Q1. On top of this, our recently launched Data-as-a-Service product, Frankly Data, has been well received by the marketplace, reflecting the industry’s growing need to solve the complex challenges of data driven advertising.
“Also during Q4, we strengthened our board of directors with the addition of
“To help support and accelerate this as well as other growth initiatives, we filed an S-1 Registration Statement relating to the proposed public offering of our common shares in the
“Overall, we are encouraged by our financial and operational progress in 2016. Looking ahead, we will continue to focus aggressively on the three growth catalysts that will scale our business over the long run: data-driven advertising, mobile and OTT apps, and strategic channel partnerships. Our continued execution on these strategic initiatives will position us to further capitalize on the traditional media industry’s multi-billion-dollar transformation to multi-screen content distribution. We expect this will help drive growth both in 2017 and the years ahead.”
Conference Call
Frankly management will hold a conference call on
Frankly CEO
International dial-in: 1-719-325-2315
Please call the conference telephone number 10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact
The conference call will be broadcasted live and available for replay here. A replay of the call will be available after
International replay dial-in: 1-412-317-6671
Replay ID: 4827823
Auditor Change
Separately, effective
About Frankly
Neither
Non-GAAP Measures
The Company reports earnings before interest, taxes, depreciation and amortization (“EBITDA”) and Adjusted EBITDA, which are not financial measures calculated and presented in accordance with Generally Accepted Accounting Principles (“GAAP”) and therefore may not be comparable to similar measures presented by other issuers. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute to net income (loss) or any other financial measures of performance or liquidity calculated and presented in accordance with GAAP. The Company defines Adjusted EBITDA as EBITDA, adjusted to exclude certain non-cash charges and other items that we do not believe are reflective of our ongoing operating results. The Company utilizes Adjusted EBITDA internally for purposes of forecasting, determining compensation, and assessing the performance of our business, therefore, we believe this measure provides useful supplemental information that may assist investors in assessing an investment in the Company.
Below is a reconciliation of adjusted EBITDA to net loss for the three and twelve month periods ended
Three Months Ended |
Year Ended |
|||||||
2016 |
2015 |
2016 |
2015 |
|||||
Net Loss |
$ (6,268,158) |
** |
$ (15,108,476) |
$ (10,710,942) |
$ (24,723,588) |
|||
Interest expense, net |
516,390 |
223,943 |
1,266,096 |
300,420 |
||||
Income tax expense |
– |
– |
– |
– |
||||
Depreciation and amortization |
951,226 |
812,685 |
3,398,491 |
1,156,143 |
||||
Stock-based compensation |
331,161 |
273,533 |
1,190,960 |
1,050,916 |
||||
Impairment expense |
4,209,000 |
12,195,985 |
4,209,000 |
12,195,985 |
||||
Loss on disposal of assets |
– |
25,935 |
1,093 |
25,935 |
||||
Transaction costs |
– |
303,016 |
– |
1,271,854 |
||||
Nasdaq listing fees |
363,927 |
– |
774,152 |
– |
||||
Other expense |
– |
251,987 |
205,681 |
251,987 |
||||
Non-operating income |
– |
(86,767) |
– |
(86,767) |
||||
Adjusted EBITDA |
$ 103,546 |
$ (1,108,159) |
$ 334,531 |
$ (8,557,115) |
||||
** Computed using Net Loss for the nine months ended
Notice Regarding Forward-Looking Statements
This release includes forward-looking statements regarding Frankly and their respective businesses. Forward-looking events and circumstances discussed in this release, may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the parties. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Frankly undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/frankly-reports-fourth-quarter-and-full-year-2016-financial-results-300440689.html
SOURCE
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