Point.360 Announces Second Fiscal Quarter And First Half Results

       Point.360 Announces Second Fiscal Quarter And First Half Results

PR Newswire

BURBANK, Calif., Feb. 7, 2013

BURBANK, Calif., Feb. 7, 2013 /PRNewswire/ -- Point.360 (NASDAQ: PTSX), a
leading provider of integrated media management services, today announced
results for the three and six month periods ended December 31, 2012, including
sales of $15.4 million for the six months, operating cash flow of $1.1 million
and earnings before interest, taxes, depreciation and amortization and
non-cash charges (EBITDAN) of $1.1 million for the first half of fiscal 2013.

Haig S. Bagerdjian, the Company's Chairman, President and Chief Executive
Officer said: "We have continued to generate positive operating cash flow even
though revenues in the first half of fiscal 2013 were lower than in the prior
year's period. Our results have been affected by some seasonality and timing
of television content releases, and we have seen a drop in revenue from
domestic and foreign distribution of non-current programming. However,
savings from consolidation of facilities and lower financing costs have been,
and will continue to be, realized."

Mr. Bagerdjian continued: "Within the next few months, we expect to open two
new Movie>Q stores to test market a smaller physical distribution model.
Since the lease costs of these stores have been previously absorbed by the
existing three stores, incremental sales are expected to generate greater
gross margins."

Revenues

Revenue for the quarter ended December 31, 2012 totaled $7.7 million compared
to $8.5 million in the same quarter last year. Revenues for the six months
ended December 31, 2012 were $15.4 million compared to $17.5 million last
year. Declines were due primarily to the timing of new television show
introductions and lower content distribution orders by a major customer.

Gross Margin

In the second quarter of fiscal 2013, gross margin was $2.5 million (33% of
sales), compared to $3.0 million (35% of revenues) in the prior year's
quarter. For the first half of fiscal 2013, gross margins were $5.2 million
or (34% of revenues), compared to $6.5 million, or 37% of revenues in last
year's period.

Selling, General and Administrative and Other Expenses

For the second quarter of fiscal 2013, SG&A expenses were $2.9 million, or 38%
of sales, compared to $3.0 million, or 35% of sales in the second quarter of
last year. For the current six month period, SG&A expenses were $5.8 million
(38% of sales), compared to $6.2 million (35% of sales) last year.

Interest expense was $0.1 million and $0.2 million for the three and six month
periods ended December 31, 2012, respectively, and $0.2 million and $0.4
million in last year's three and six month periods. The decrease was due to
lower interest rates and amounts borrowed.

Other income in all periods includes sublease income and gain on sale of fixed
assets. In the fiscal 2013 six month period, other income also included a
$332,000 discount received on the payoff of a mortgage, offset by the write
offs of $90,000 of deferred financing costs related to that mortgage and a
$30,000 fee to terminate a revolving credit agreement.

Operating Income (Loss)

The operating loss was $0.4 million in the second quarter of fiscal 2013
compared to a $44,000 profit in last year's second quarter. For the six
months ended December 31, 2012, the operating loss was $0.6 million compared
to operating income of $0.3 million last year.

Net Income (loss)

For the second quarter and first half of fiscal 2013, the Company reported net
losses of $0.4 million ($0.04 per share) and $0.5 million ($0.05 per share),
respectively, compared to net income of $51,000 ($0.00 per share) and $0.2
million ($0.02 per share) in the same periods last year.

Earnings Before Interest, Taxes, Depreciation, Amortization and Non-Cash
Charges (EBITDAN)*

The following table reconciles the Company's EBITDAN to net income which is
the most directly comparable financial measure under Generally Accepted
Accounting Principles ("GAAP"):

Computation of EBITDAN (unaudited)*
                               Three Months Ended     Six Months Ended
                               December 31,           December 31,
                               2011       2012        2011        2012
Net income (loss)              $51,000    $(390,000)  $160,000    $(495,000)
 Interest (net)           189,000    80,000      418,000     248,000
 Income taxes             --         --          --          --
 Depreciation &           796,000    625,000     1,537,000   1,238,000
amortization
 Other non-cash charges:
 Bad debt expense     8,000      9,000       17,000      16,000
 Stock based          102,000    60,000      187,000     102,000
compensation
EBITDAN                        $1,146,000 $  384,000 $ 2,319,000 $ 1,109,000





Consolidated Statements of Operations (unaudited) *
The table below summarizes results for the three month periods ended December
31, 2011 and 2012:
                       Three Months Ended          Six Months Ended

                       December 31,                December 31,
                       2011          2012          2011          2012
Revenues              $       $           $         $ 
                       8,542,000     7,745,000    17,511,000    15,406,000
Cost of services sold  (5,513,000)   (5,221,000)   (11,039,000)  (10,174,000)
Gross profit           3,029,000     2,524,000     6,472,000     5,232,000
Selling, general and   (2,985,000)   (2,910,000)   (6,164,000)   (5,843,000)
administrative expense
Operating income       44,000        (386,000)     308,000       (611,000)
(loss)
Interest expense       (209,000)     (80,000)      (438,000)     (248,000)
Interest income        20,000        -             20,000        -
Other income           196,000       76,000        270,000       364,000
Income (loss) before   51,000        (390,000)     160,000       (495,000)
income taxes
Benefit from income    -             -             -             -
taxes
Net income loss        $       $        $       $     
                         51,000   (390,000)     160,000      (495,000)
Income (loss) per
share:
 Basic:
                       $       $       $       $      
 Net loss                (0.04)       0.02     (0.05)
                       -
 Weighted
average number of      10,513,166    10,513,166    10,513,166    10,513,166
shares
 Diluted:
 Net income     $       $       $       $      
loss                            (0.04)       0.02     (0.05)
                       -
 Weighted
average number of
sharesincluding the   10,576,494    10,513,166    10,524,050    10,513,166
dilutive effect of
stockoptions





Selected Balance Sheet Statistics (unaudited)*
                                June 30,                December 31,

                                2012                    2012
Working Capital                 $       4,261,000 $      
                                                        3,537,000
Property and equipment, net     17,475,000              16,757,000
Total assets                    25,971,000              24,633,000
Current portion of long term    172,000                 466,000
debt
Long-term debt, net of current  9,236,000               8,400,000
portion
Shareholder's equity            10,231,000              9,838,000

*The consolidated statements of operations, computation of EBITDAN and
presentation of balance sheet statistics do not represent the results of
operations or the financial position of the Company in accordance with
generally accepted accounting principles (GAAP), and are not to be considered
as alternatives to the balance sheet, statement of income, operating income,
net income or any other GAAP measurements as an indicator of operating
performance or financial position. Not all companies calculate such
statistics in the same fashion and, therefore, the statistics may not be
comparable to other similarly titled measures of other companies. Management
believes that these computations provide additional useful analytical
information to investors.

About Point.360

Point.360 (PTSX) is a value add service organization specializing in content
creation, manipulation and distribution processes integrating complex
technologies to solve problems in the life cycle of Rich Media. With locations
in greater Los Angeles, Point.360 performs high and standard definition audio
and video post production, creates virtual effects and archives and
distributes physical and electronic Rich Media content worldwide, serving
studios, independent producers, corporations, non-profit organizations and
governmental and creative agencies. Point.360 provides the services necessary
to edit, master, reformat and archive clients' audio and video content,
including television programming, feature films and movie trailers.
Point.360's interconnected facilities provide service coverage to all major
U.S. media centers. The Company also rents and sells DVDs and video games
directly to consumers through its Movie>Q retail stores. See www.Point360.com
and www.MovieQ.com.

Forward-looking Statements

Certain statements in Point.360 press releases may contain "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements include, without limitation, statements
regarding (i) the Company's projected revenues, earnings, cash flow and
EBITDA; (ii) planned focus on internal growth and acquisitions; (iii)
reduction of facilities and actions to streamline operations; (iv) actions
being taken to reduce costs and improve customer service and (v) new business
and new acquisitions. Please also refer to the risk factors described in the
Company's SEC filings, including its annual reports on Form 10-K. Such
statements are inherently subject to known and unknown risks, uncertainties
and other factors that may cause actual results, performance or achievements
of the Company to be materially different from those expected or anticipated
in the forward-looking statements. In addition to the factors described in
the Company's SEC filings, the following factors, among others, could cause
actual results to differ materially from those expressed herein: (a) lower
than expected net sales, operating income and earnings; (b) less than expected
growth; (c) actions of competitors including business combinations,
technological breakthroughs, new product offerings and promotional successes;
(d) the risk that anticipated new business may not occur or be delayed; (e)
the risk of inefficiencies that could arise due to top level management
changes and (f) general economic and political conditions that adversely
impact the Company's customers' willingness or ability to purchase or pay for
services from the Company. The Company has no responsibility to update
forward-looking statements contained herein to reflect events or circumstances
occurring after the date of this release.

SOURCE Point.360

Website: http://www.point360.com
Contact: Alan Steel, Executive Vice President, +1-818-565-1444
 
Press spacebar to pause and continue. Press esc to stop.