Point.360 Announces Third Fiscal Quarter And Year To Date Results

      Point.360 Announces Third Fiscal Quarter And Year To Date Results

PR Newswire

LOS ANGELES, May 9, 2013

LOS ANGELES, May 9, 2013 /PRNewswire/ -- Point.360 (NASDAQ: PTSX), a leading
provider of integrated media management services, today announced results for
the three and nine month periods ended March 31, 2013, including nine month
sales of $23.7 million, operating cash flow of $1.6 million, and earnings
before interest, taxes, depreciation and amortization and non-cash charges
(EBITDAN) of $2.0 million.

Haig S. Bagerdjian, the Company's Chairman, President and Chief Executive
Officer said: "We continued to generate positive cash flow in the first nine
months of fiscal 2013. We are finding increasing demand for localization of
content for international use. Additionally, we are working with several major
portals for the delivery of content."

Mr. Bagerdjian continued: "By the end of summer, we expect to open two new
Movie>Q stores to test a smaller physical distribution model. Delays have
resulted from the long ordering periods for certain components related to the
new system. 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 March 31, 2013 totaled $8.3 million compared to
$8.5 million in the same quarter last year. Revenues for the nine months
ended March 31, 2013 were $23.7 million compared to $26.0 million last year.
Declines were due primarily to lower content distribution orders by a major
customer.

Gross Margin

In the third quarter of fiscal 2013, gross margin was $3.1 million (37% of
sales), compared to $2.8 million (33% of sales) in the prior year's quarter.
For the first nine months of fiscal 2013, gross margins were $8.3 million (35%
of sales), compared to $9.3 million (36% of sales) in last year's period.

Selling, General and Administrative and Other Expenses

For the third quarter of fiscal 2013, SG&A expenses were $3.0 million, or 37%
of sales, compared to $3.0 million, or 36% of sales in the third quarter of
last year. For the current nine month period, SG&A expenses were $8.9 million
(37% of sales), compared to $9.2 million (35% of sales) last year.

Interest expense was $0.1 million and $0.3 million for the three and nine
month periods ended March 31, 2013, respectively, and $0.2 million and $0.6
million in last year's three and nine month periods. The decrease was due to
lower interest rates and amounts borrowed.

Other income in all periods includes sublease income. In the fiscal 2013 nine
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, in addition to income of $131,000 associated
with a change in accounting estimate related to a customer rebate program.

Operating Income (Loss)

Operating income was $11,000 in the third quarter of fiscal 2013 compared to a
$0.2 million loss in last year's quarter. For the nine months ended March 31,
2013, the operating loss was $0.6 million compared to operating income of $0.1
million last year.

Net Income (loss)

For the third quarter, the Company reported net income of $0.2 million ($0.01
per share) compared to a loss of $0.3 million ($0.03 per share) in the prior
year's quarter. For the first nine months of fiscal 2013, the Company
reported net losses of $0.3 million ($0.03 per share) compared to $0.2 million
($0.02 per share) in the same period 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          Nine Months Ended
                         March 31,                   March 31,
                         2012        2013            2012         2013
Net income (loss)        $(327,000)  $   150,000  $(167,000)   $(345,000)
 Interest (net)      199,000     68,000          617,000      316,000
 Income taxes        --          --              --           --
 Depreciation &      728,000     616,000         2,264,000    1,854,000
amortization
 Other non-cash
charges:
 Bad debt       9,000       8,000           26,000       24,000
expense
 Stock based    65,000      56,000          252,000      158,000
compensation
EBITDAN                  $674,000    $  898,000     $ 2,993,000  $ 2,007,000





Consolidated Statements of Operations (unaudited) *
The table below summarizes results for the three month periods ended March 31,
2012 and 2013:
                     Three Months Ended            Nine Months Ended

                     March 31,                     March 31,
                     2012           2013           2012          2013
Revenues             $        $          $          $    
                     8,497,000     8,295,000     26,008,000    23,701,000
Cost of services     (5,657,000)    (5,244,000)    (16,696,000)  (15,418,000)
sold
Gross profit         2,840,000      3,051,000      9,312,000     8,283,000
Selling, general and
administrative       (3,045,000)    (3,040,000)    (9,209,000)   (8,883,000)
expense
Operating Income     (205,000)      11,000         103,000       (600,000)
(loss)
Interest expense     (199,000)      (68,000)       (637,000)     (316,000)
Interest income      -              -              20,000        -
Other income         77,000         207,000        347,000       571,000
Income (loss) before (327,000)      150,000        (167,000)     (345,000)
income taxes
Provision for income -              -              -             -
taxes
Net income (loss)    $        $         $        $     
                     (327,000)     150,000       (167,000)     (345,000)
Income (loss) per
share:
 Basic:
Net income    $        $        $       $      
(loss)                  (0.03)     0.01      (0.02)       (0.03)
 Weighted
average number of    10,513,166     10,513,166     10,513,166    10,513,166
shares
 Diluted:
Net income    $        $        $       $      
(loss)                  (0.03)     0.01      (0.02)       (0.03)
 Weighted
average number of
shares including the 10,513,166     10,513,166     10,513,166    10,513,166
dilutive effect of
stockoptions





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

                                2012                    2013
Working Capital                 $       4,261,000 $      
                                                        4,039,000
Property and equipment, net     17,475,000              16,315,000
Total assets                    25,971,000              24,811,000
Current portion of long term    172,000                 444,000
debt
Long-term debt, net of current  9,236,000               8,288,000
portion
Shareholder's equity            10,231,000              10,044,000

*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, (818) 565-1444