YOU On Demand Reports 2014 Q1 Results and Provides Update on Ongoing Operational Progress - Northern Michigan's News Leader

YOU On Demand Reports 2014 Q1 Results and Provides Update on Ongoing Operational Progress

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SOURCE YOU On Demand Holdings, Inc.

Management Hosting Investor Webcast and Analyst Call at 4:30 p.m. ET

NEW YORK, May 15, 2014 /PRNewswire/ -- YOU On Demand Holdings, Inc. (NASDAQ: YOD) ("YOU On Demand" or the "Company" or "YOD"), a leading multi-platform entertainment and Video On Demand (VOD) company in China, announced today its operating results for the three-month period ending March 31, 2014 (a full copy of its quarterly report on Form 10-Q will also be posted at www.sec.gov).

Chairman Shane McMahon, CEO Weicheng Liu and President & CFO Marc Urbach are hosting an investor webcast and analyst conference call today at 4:30 p.m. ET to discuss the Company's recent operating results and provide an update on the ongoing progress. The live and archived webcast will be available here, in the 'Webcasts and Events' section of the corporate.yod.com website. For those wishing to dial in, please call +1 212 231 2905. Questions will also be accepted and addressed, time permitting, via emails to ir@yod.com.

Shane McMahon, Chairman of YOU On Demand, commented, "The 2014 first quarter was a productive period and we are very excited about what the future holds as we continue to expand our distribution platform across IPTV, OTT and Mobile. Due to the tremendous potential of these exciting technologies we are refocusing our efforts and prioritizing these platforms. Concurrently, we are also continuing to deploy YOD's China-based sales team in targeting the numerous, but still fragmented digital cable MSO operators, with the goal of further expanding our reach as this platform continues to mature and our brand grows in popularity among consumers."

YOU On Demand CEO Weicheng Liu, stated, "Our strong balance sheet, healthy cash position and a firm commitment to prudent expense management, position the Company to capitalize on the significant opportunities that lay ahead as we continue leveraging the goodwill inherent in the YOD brand. We believe that each of our business initiatives, across multiple platforms, offers a unique shareholder return opportunity and we remain confident that we will be able to unlock future value for the benefit of all stakeholders."

2014 Q1 Operating Results

Revenue for the quarter ended March 31, 2014 increased to $138,000 from $938 in the quarter ended March 31, 2013. Gross loss for the quarter ended March 31, 2014 declined to $738,000, from $848,000 in the quarter ended March 31, 2013. Total operating expenses for the quarter ended March 31, 2014 declined 21.8% from the quarter ended March 31, 2013, which reflects the success of our strategy of forging revenue-sharing agreements with content partners while keeping corporate overhead at manageable levels. We reported a reduced loss from operations of $2.7 million for the quarter ended March 31, 2014, down from $3.4 million in the prior year period. Our net loss from continuing operations for the quarter ended March 31, 2014 increased to $7.5 million from $3.5 million in the prior year period. Our net loss attributable to YOU on Demand common shareholders was $23.6 million (compared to $3.3 million in the prior year period), which was impacted by several one-time, non-cash items. These one-time, non-cash items include a $16.4 million non-cash beneficial conversion feature incurred as part of our Preferred Series E share sale, as well as changes in the fair value of warrant liabilities of $2.4 million and contingent consideration of $0.7 million. The reported per share loss from continuing operations for the quarter ended March 31, 2014 was $1.48 as compared to $0.21 per share loss from continuing operations in the prior year period.

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.

About YOU On Demand Holdings, Inc. (http://corporate.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.

CONTACT:


Jason Finkelstein

Robert Rinderman or Norberto Aja

YOU On Demand

JCIR

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












Three Months Ended




March 31,



March 31,




2014



2013




(unaudited)



(unaudited)









Revenue

$

137,681


$

938


Cost of revenue


875,938



848,585


Gross loss


(738,257)



(847,647)









Operating expense:







     Selling, general and administrative expenses


1,640,640



1,983,736


     Professional fees


185,484



251,434


     Depreciation and amortization


149,960



292,833


Total operating expense


1,976,084



2,528,003









Loss from operations


(2,714,341)



(3,375,650)









Interest & other income / (expense)














     Interest expense, net


(2,288,738)



(29,360)


     Change in fair value of warrant liabilities


(2,439,018)



(25,405)


     Change in fair value of contingent consideration


(703,126)



(41,648)


     Loss on investment in unconsolidated entities


(4,908)



(2,994)


     Gain on sale subsidiary


755,426



-


     Loss on dissolution of variable interest entity


(27,463)



-


     Other


(52,666)



(1,181)









Net loss from continuing operations before income taxes and noncontrolling interest


(7,474,834)



(3,476,238)









Income tax benefit


22,942



31,140









Net loss from continuing operations


(7,451,892)



(3,445,098)









Net loss from discontinued operations


-



(230,069)









Net loss

$

(7,451,892)


$

(3,675,167)









Plus: Net loss attributable to noncontrolling interest


234,784



330,402









Net Loss attributable to YOU On Demand shareholders


(7,217,108)



(3,344,765)


Dividends on preferred stock


(16,402,161)



-


Net loss attributable to You On Demand common shareholders

$

(23,619,269)


$

(3,344,765)









Basic loss per share







     Loss from continuing operations

$

(1.48)


$

(0.21)


     Loss from discontinued operations

$

-


$

(0.02)


     Basic loss per share

$

(1.48)


$

(0.23)









Diluted loss per share







     Loss from continuing operations

$

(1.48)


$

(0.21)


     Loss from discontinued operations

$

-


$

(0.02)


     Diluted loss per share

$

(1.48)


$

(0.23)









Weighted average shares outstanding







     Basic


15,931,394



14,602,196


     Diluted


15,931,394



14,602,196


 

YOU On Demand Holdings, Inc. and Its Subsidiaries


CONSOLIDATED BALANCE SHEETS






March 31,



December 31,




2014



2013




(Unaudited)





ASSETS







Current assets:







       Cash and cash equivalents

$

17,954,910


$

3,822,889









       Accounts receivable, net


186,715



175,211


       Licensed content, current


1,070,036



428,322


       Prepaid expenses


505,846



330,013


       Debt issuance cost, net


-



128,879


       Other current assets


57,683



48,928









Total current assets


19,775,190



4,934,242









Property and equipment, net


433,400



499,858


Licensed content, noncurrent


117,414



162,646


Intangible assets, net


2,535,825



2,621,527


Goodwill


6,105,478



6,105,478


Investment in unconsolidated entities


663,066



673,567









Total assets

$

29,630,373


$

14,997,318









LIABILITIES AND EQUITY







Current liabilities:







       Accounts payable

$

1,167,185


$

656,545


       Accrued expenses and liabilities


943,453



1,046,920


       Deferred revenue


79,791



68,969


       Deferred license fees


998,225



1,200,764


       Other current liabilities


6,943



29,024


       Contingent purchase price consideration liability


1,281,870



578,744


       Convertible promissory note


3,000,000



3,000,000


       Warrant liabilities


3,189,273



1,344,440


Total current liabilities


10,666,740



7,925,406









Deferred tax liability


102,867



125,809


Convertible promissory note


-



2,000,000


Total liabilities


10,769,607



10,051,215









Commitments and Contingencies














Convertible redeemable preferred stock, $.001 par value; 50,000,000 shares authorized




     Series A - 7,000,000 shares issued and outstanding, liquidation preference of $3,500,000 at March 31, 2014 and December 31, 2013, respectively


1,261,995



1,261,995


     Series C – 87,500 shares issued and outstanding, liquidation 
preference of $350,000 at March 31, 2014 and December 31, 2013, respectively


219,754



219,754


     Series D 4% - 0 and 2,285,714 shares issued and outstanding, liquidation preference of $0 and $4,000,000 at March 31, 2014  and December 31, 2013, respectively


-



4,000,000









Equity:







     Preferred Series E stock, $.001 par value; 16,500,000 shares authorized, 14,285,714 and 0 shares issued at March 31, 2014 and December 31, 2013, respectively


14,286



-


     Common stock, $.001 par value; 1,500,000,000 shares authorized, 16,097,154 and 15,794,762 shares issued at March 31, 2014 and December 31, 2013, respectively


16,097



15,794









     Additional paid-in capital


109,865,767



67,417,025









     Accumulated deficit


(89,553,787)



(65,856,053)









     Accumulated other comprehensive loss


(1,324,359)



(715,090)









Total YOU On Demand equity


19,018,004



861,676









Noncontrolling interests


(1,638,987)



(1,397,322)









Total equity


17,379,017



(535,646)









Total liabilities and equity

$

29,630,373


$

14,997,318


 

©2012 PR Newswire. All Rights Reserved.

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