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Digital Cinema Destinations Corp. (Digiplex) Reports Fiscal 2013 Fourth Quarter Increases in Revenue and Per Cap Metrics

  Digital Cinema Destinations Corp. (Digiplex) Reports Fiscal 2013 Fourth
  Quarter Increases in Revenue and Per Cap Metrics

   - Theater Level Cash Flow and Adjusted EBITDA Also Rise Significantly -

Business Wire

WESTFIELD, N.J. -- September 17, 2013

Digital Cinema Destinations Corp. (NasdaqCM:DCIN) (Digiplex), a fast-growing
motion picture exhibitor dedicated to transforming movie theaters into digital
entertainment centers, today reported its fiscal 2013 fourth quarter and
full-year financial results for the periods ended June 30, 2013. Management is
hosting a conference call and webcast at 4:30 p.m. ET to review the results.



DATE/TIME: Today—Tuesday, September 17, 2013 at 4:30 p.m. ET



TELEPHONE: dial 800/404-5245. Please call at least five minutes in advance to
ensure that you are connected.



WEBCAST: live webcast is available through the Investor Relations section of
Digiplex’s website at www.digiplexdest.com. A webcast replay will be available
and accessible for at least 30 days following the live event.



                                                  
                                                     
SUMMARY AND SUPPLEMENTARY FINANCIAL DATA

(unaudited)
                                                     
                       Three Months Ended            Twelve Months Ended
                                                 
                       June 30,                      June 30,
(in thousands)         2013         2012           2013         2012
Consolidated total     $ 11,201       $ 3,796        $ 31,184       $ 6,671
revenue
Consolidated net loss    (1,209 )       (1,002 )       (5,256 )       (1,967 )
                                                                    
Consolidated theater     1,922          701            5,633          1,251
level cash flow (1)
Adjusted EBITDA of
Digital Cinema           888            32             2,366          (410   )
Destinations Corp. (1)
                                                          
Theaters (period end)    18             8              18             8
Average screens          178            62             130            30
Average attendance per   5,667          5,506          22,014         19,331
screen
Average admission per  $ 7.92         $ 7.82         $ 7.83         $ 8.31
patron
Average concessions    $ 3.45         $ 3.04         $ 3.27         $ 2.89
sales per patron
Total attendance (in     1,009          339            2,852          570
thousands)
                                                                             

    (1) Theater level cash flow and Adjusted EBITDA are supplemental non-GAAP
  financial measures. Reconciliations of these metrics to the net loss for
    the three and twelve months ended June 30, 2013 and 2012 are included in
    the supplementary tables accompanying this news announcement.
    
    

Digiplex Chairman and CEO Bud Mayo stated, “The fiscal fourth quarter was a
productive period for Digiplex and also for the U.S. box office. Industry
admissions receipts grew approximately 7.8% versus the prior year and our
Company achieved revenue, Adjusted EBITDA, and theater level cash flow
increases, due to the 116 additional average screens under operation, compared
to the 2012 fiscal fourth quarter, as well as internal operational
improvements during a favorable box office environment.

“Of note, the 2013 fiscal fourth quarter marks the first time in our
organization’s short history that over one million patrons attended Digiplex’s
locations. We continue to focus on providing our valued customers with high
quality service and a clean and friendly environment to enjoy the best
selection of popular Hollywood titles, specially curated independent pictures
and exciting alternative programming events. We are also driving incremental
theater traffic through unique social media and targeted marketing strategies.

“An exciting development during fiscal Q4 was the opening of our first IMAX^®
location, at Digiplex’s Surprise Pointe 14 theater in Arizona. We are
extremely pleased to form a new alliance with IMAX^® and will evaluate
potential additional large format locations that feature their leading
entertainment experience as the Digiplex circuit continues expanding.
Subsequent to fiscal year-end, we also 4D-enabled an auditorium at our Solon,
OH theater with the installation of immersive ButtKicker seating. We will
continue experimenting with state-of-the-art technologies that further enhance
the enjoyment of our guests.

“Throughout fiscal 2013, Digiplex opportunistically identified and completed
acquisitions in attractive markets that adhere to our theater level cash flow
and asset quality criteria. As a result, our organization nearly tripled its
average screen count versus the prior year. We completed the purchase of a
state-of-the art, fully digital 12-plex in Lisbon, CT during the fiscal first
quarter, in fiscal Q2 we acquired seven theaters and 74 screens from UltraStar
Cinemas on the west coast and we added two additional theaters with an
aggregate of 19 screens in Solon, OH and Sparta, NJ during fiscal Q3.
Additionally, subsequent to our year-end we acquired a 6-plex in Torrington,
CT, further expanding the Company’s circuit to 19 locations and 184 screens.

“We are proud of our achievements to date, but acknowledge that we are still
in the early stages of expanding Digiplex’s footprint to the 100 location/1000
screen goal we have set as a corporate milestone. Our top priority continues
to be executing disciplined growth through opportunistic acquisitions. As we
build scale, roll new theaters onto our digital platform, and leverage the
Company’s corporate infrastructure and operating disciplines, over time we
expect to achieve meaningful improvements in both top- and bottom-line
results,” Mr. Mayo concluded.

                                                             
                                                                    
DIGITAL CINEMA DESTINATIONS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)
                                                                    
                                                     June 30,       June 30,

                                                     2013           2012
ASSETS
CURRENT ASSETS
Cash and cash equivalents                            $ 3,607        $ 2,037
Accounts receivable                                    697            238
Inventories                                            191            78
Deferred financing costs, current portion              357            -
Prepaid expenses and other current assets             1,444        381    
                                                                    
Total current assets                                   6,296          2,734
Property and equipment, net                            29,171         15,432
Goodwill                                               3,156          980
Intangible assets, net                                 6,186          4,114
Security deposit                                       205            3
Deferred financing costs, long term portion,           1,225          -
net
Other assets                                          9            14     
                                                                    
TOTAL ASSETS                                         $ 46,248      $ 23,277 
                                                                    
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable                                     $ 2,478        $ 851
Accrued expenses                                       3,964          1,088
Payable to vendor for digital systems                  -              3,334
Notes payable, current portion                         1,373          1,000
Capital lease, current portion                         121            -
Earnout from theater acquisition                       296            79
Deferred revenue                                      305          31     
                                                                    
Total current liabilities                              8,537          6,383
                                                                             
NONCURRENT LIABILITIES
Notes payable, long term portion                       8,615          -
Capital lease, net of current portion                  239            -
Unfavorable leasehold liability, long term             159            190
portion
Deferred rent expense                                  407            83
Deferred tax liability                                199          39     
                                                                    
TOTAL LIABILITIES                                     18,156       6,695  
                                                                    
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Preferred Stock, $.01 par value, 10,000,000
shares authorized as of June 30, 2013 and
2012,
respectively; and 6 and 0 shares issued of             -              -
Series B Preferred Stock issued and
outstanding as
of June 30, 2013 and 2012, respectively
                                                                             
Class A Common Stock, $.01 par value,
20,000,000 shares authorized; 5,511,938 and            55             45
4,519,452 shares issued and outstanding as
of June 30, 2013 and 2012, respectively
                                                                             
Class B Common Stock, $.01 par value,
900,000 shares authorized; 865,000 and
900,000                                                9              9
shares issued and outstanding as of June 30,
2013 and 2012, respectively
                                                                             
Additional paid-in capital                             25,816         19,285
Accumulated deficit                                   (7,049 )      (2,757 )
TOTAL STOCKHOLDERS’ EQUITY OF DIGITAL CINEMA           18,831         16,582
DESTINATIONS CORP
Noncontrolling interest                               9,261        -      
                                                                    
Total Equity                                          28,092       16,582 
TOTAL LIABILITIES AND EQUITY                         $ 46,248      $ 23,277 
                                                                             
                                                                             

                                                                 
                                                                                      
DIGITAL CINEMA DESTINATIONS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)
                                                                                      
                    Three Months Ended                  Twelve Months Ended

                    June 30,                            June 30,
                    2013              2012              2013              2012
REVENUES
Admissions          $ 7,578           $ 2,651           $ 21,305          $ 4,738
Concessions           3,301             1,032             8,889             1,646
Other                322             113             990             287       
                                                                                      
Total revenues       11,201          3,796         31,184            6,671     
                                                                                      
COSTS AND
EXPENSES
                                                                                      
Cost of
operations:
Film rent             3,996             1,484             10,694            2,387
expense
Cost of               595               187               1,491             294
concessions
Salaries and          1,412             452               3,791             849
wages
Facility lease        1,600             423               4,435             821
expense
Utilities and         2,052             594               5,797             1,152
other
General and           1,743             855               5,054             1,945
administrative
Change in fair
value of earn         (254      )       -                 (333      )       (20       )
out
Depreciation
and                  665             760             4,049           1,147     
amortization
                                                                                      
Total costs and      11,809          4,755           34,978          8,575     
expenses
                                                                                      
OPERATING LOSS        (608      )       (959      )       (3,794    )       (1,904    )
OTHER EXPENSE
Interest              (379      )       (12       )       (999      )       (12       )
expense
Non-cash
interest              (75       )       -                 (228      )       -
expense
Other expense        (14       )      (7        )      (60       )      (9        )
                                                                                      
LOSS BEFORE           (1,076    )       (978      )       (5,081    )       (1,925    )
INCOME TAXES
                                                                                      
Income tax           133             24              175             42        
expense
                                                                                      
NET LOSS            $ (1,209    )     $ (1,002    )     $ (5,256    )     $ (1,967    )
                                                                                      
Net loss
attributable to      251             -               964             -         
non-controlling
interest
                                                                                      
Net loss
attributable to
Digital Cinema      $ (958      )     $ (1,002    )     $ (4,292    )     $ (1,967    )
Destinations
Corp.
                                                                                      
Preferred stock      (5        )      (21       )      (16       )      (257      )
dividends
                                                                                      
Net loss
attributable to     $ (963      )     $ (1,023    )     $ (4,308    )     $ (2,224    )
common
stockholders
                                                                                      
Net loss per
Class A and
Class B common
share – basic
and diluted         $ (0.15     )     $ (0.23     )     $ (0.74     )     $ (1.00     )

attributable to
common
stockholders
                                                                                      
Weighted
average common        6,324,272         4,472,914         5,828,283         2,218,045
shares
outstanding
                                                                                      
                                                                                      

                                              
                                                     
SUPPLEMENTARY NON-GAAP RECONCILIATION

OF ADJUSTED EBITDA

(Unaudited) ($ in thousands)
                                                     
                       Three months ended            Twelve months ended
                       June 30,                      June 30,
                       2013         2012           2013         2012
Net loss               $ (1,209 )     $ (1,002 )     $ (5,256 )     $ (1,967 )
Add back:
Depreciation
and                      665            760            4,049          1,147
amortization
Interest                 454            24             1,227          12
expense
Income tax               133            24             175            42
expense
Other expense            14             7              60             9
Deferred rent            132            33             324            63
expense (5)
Stock-based
compensation             400            155            549            204
(2)
Non-recurring
organizational
and                      90             31             642            80
M&A-related
professional
fees (3)
Management               288            -              543            -
fees (4)
(Deduct) Add:
Start Media's
share of                (79    )      -            53           -      
Adjusted
EBITDA
Adjusted
EBITDA of
Digital Cinema         $ 888         $ 32          $ 2,366       $ (410   )
Destinations
Corp.
                                                                             
                                                                             

                                              
                                                     
SUPPLEMENTARY NON-GAAP RECONCILIATION

OF THEATER LEVEL CASH FLOW

(Unaudited) ($ in thousands)
                                                     
                       Three months ended            Twelve months ended
                       June 30,                      June 30,
                       2013         2012           2013         2012
Net loss               $ (1,209 )     $ (1,002 )     $ (5,256 )     $ (1,967 )
Add back:
General and
administrative           1,743          855            5,054          1,945
(1)
Depreciation
and                      655            760            4,049          1,147
amortization
Income tax               133            24             175            42
expense
Interest                 454            24             1,227          12
expense
Other expense            14             7              60             9
Deferred rent           132          33           324          63     
expense (5)
Consolidated           $ 1,922       $ 701         $ 5,633       $ 1,251  
TLCF
                                                                             

(1) TLCF is intended to be a measure of theater profitability. Therefore, our
corporate general and administrative expenses have been excluded.
(2) Represents the fair value of shares of Class A common stock and restricted
stock awards issued to employees and non-employees for services rendered. As
these are non-cash charges, we believe that it is appropriate to show Adjusted
EBITDA excluding this item.
(3) Primarily represents professional fees incurred in connection with
start-up activities, the creation of acquisition template documents that will
be used by us for future transactions, and certain other costs related to our
acquisition strategy. Since we intend to acquire additional theaters, we have
laid the groundwork for our acquisition program and we expect to incur reduced
legal fees in connection with future acquisitions. We therefore believe that
it is appropriate to exclude these items from Adjusted EBITDA.
(4) To add back management fees to Digiplex from JV.
(5) Represents non-cash deferred rent expense which is included in our
facility lease expense in the consolidated statements of operations. As these
are non-cash changes, we believe it is appropriate to show TLCF and Adjusted
EBITDA excluding this item.



Disclosure Regarding Forward-Looking Statements

This press release and other written or oral statements made by or on behalf
of Digital Cinemas Destination Corp. may contain forward-looking statements
within the meaning of the federal securities laws. Statements that are not
historical facts, including statements about our beliefs, expectations and
future performance, are forward-looking statements. Forward-looking statements
are only predictions and are not guarantees of performance. These statements
are based on beliefs and assumptions of management, which in turn are based on
currently available information. The forward-looking statements also involve
risks and uncertainties, which could cause actual results to differ materially
from those contained in any forward-looking statement. Many of these factors
are beyond our ability to control or predict. Risk factors are disclosed in
our Annual Report on Form 10-K under the caption “Risk Factors.” We believe
these forward-looking statements are reasonable; however, undue reliance
should not be placed on any forward-looking statements, which are based on
current expectations. Further, forward-looking statements speak only as of the
date they are made, and we undertake no obligation to update publicly any of
them in light of new information or future events.

About Digital Cinema Destinations Corp. (www.digiplexdest.com)

Digital Cinema Destinations Corp. is dedicated to transforming its movie
theaters into interactive entertainment centers. The Company provides
consumers with uniquely satisfying experiences, combining state-of-the-art
digital technology with engaging, dynamic content that far transcends
traditional cinematic fare. The Company’s customers enjoy live and
pre-recorded alternative programming such as concerts, operas, ballets,
sporting events, conferences, interactive videogames, auctions, fashion shows
and, on an ongoing basis, the very best major motion pictures.As of September
1, 2013, Digiplex operates 19 cinemas and 184 screens in AZ, CA, CT, NJ, OH
and PA. You can connect with Digiplex via Facebook, Twitter, YouTube and
Blogger. Digiplex is also participating in DigiNext, a unique, specialty
content joint venture (with Nehst Studios) featuring curated content from
festivals around the world. DigiNext releases typically include innovative
live Q&A sessions between the audience and cast members.

Contact:

Digital Cinema Destinations Corp.
Bud Mayo, 908-396-1362
Chairman/CEO
bmayo@digiplexdest.com
or
JCIR
Robert Rinderman or Jennifer Neuman
212-835-8500 or DCIN@jcir.com