NEW YORK–(BUSINESS WIRE)–The Enviornment Group Holdings, Inc. (NYSE American: AREN) (“The Enviornment Group”), a tech-powered media firm with 35 owned and operated properties and greater than 200 manufacturers together with Sports activities Illustrated, TheStreet, Inc. (“TheStreet”) and HubPages, Inc. (“HubPages”) working on a single expertise platform, at this time introduced monetary outcomes for the three and twelve months ended December 31, 2021.
2021 Monetary and Operational Highlights
- For the fourth quarter of 2021, complete income elevated 44% to $61.2 million from $42.4 million within the prior 12 months interval.
- Full-year complete income elevated 48% to $189.1 million, in comparison with $128.0 million in 2020.
- Quarterly gross revenue proportion improved to 56%, as in comparison with 37% within the fourth quarter of 2020.
- Internet loss improved to $19.1 million in comparison with a internet loss $22.0 million within the fourth quarter of 2020. Internet loss remained comparatively flat year-over-year at $89.9 million for fiscal 2021 as in comparison with $89.2 million for fiscal 2020.
- Non-cash fees signify 76% of our present 12 months internet lack of $89.9 million.
- Adjusted EBITDA* improved to a optimistic $1.1 million for the fourth quarter of 2021 as in comparison with a lack of $2.1 million for the fourth quarter of 2020. Adjusted EBITDA* improved to a lack of $12.1 million for fiscal 12 months 2021 as in comparison with a lack of $23.2 million for fiscal 2020.
*This press launch consists of reference to non-GAAP monetary measures. Please see the heading “Use of Non-GAAP Monetary Measures” under for a extra full rationalization.
Administration Commentary
Chairman and Chief Govt Officer of The Enviornment Group Ross Levinsohn stated, “2021 was a watershed 12 months for our Firm, our workers, companions and stockholders with report income progress, operational effectivity, a nationwide itemizing of our widespread inventory on the NYSE American and transformative acquisitions. It was additionally a 12 months of vital funding, as we developed, streamlined, and validated our expertise stack and our strategic method, establishing a scalable platform for worthwhile progress. Due largely to this technique, we have now clearly confirmed our skill to drive income and viewers progress and increase income streams, resulting in margin growth throughout all our properties. Our momentum in Q1 of 2022 has accelerated, with additional progress throughout nearly each sector and we’re effectively positioned to proceed to increase with our new way of life vertical, anchored by the favored manufacturers established by AMG Parade (which is anticipated to shut shortly). Our extremely environment friendly, knowledge pushed, technology-powered media platform is now confirmed and working at scale, with important room for growth each organically and inorganically. We proceed so as to add extremely related content material to our platform, leveraging model recognition, sturdy viewers growth capabilities and a unified backend system driving effectivity and margins to create worth for our companions throughout our ecosystem.”
“We imagine fiscal 2022 might be a 12 months of continued progress,” added Levinsohn. “We now have reached the tipping level with our expertise. The investments to construct this platform are largely behind us, and incremental income will disproportionately fall to the bottom-line. We now have recruited an skilled, centered crew, grown our capital base and anticipate to point out a optimistic adjusted EBITDA throughout 2022. Our goal is to determine 5 verticals by the tip of 2022. Upon closing the AMG Parade acquisition, we could have three verticals, with a number of alternatives for no less than two extra. This added scale opens the door to new income alternatives, such because the launch of our commerce initiatives, audio/podcast and video choices and plans to enter each the NFT and Metaverse companies on this 12 months.”
Latest Enterprise Highlights
- The Firm signed a non-binding letter of intent to amass AMG Parade, a premium multimedia content material firm reaching greater than 250 million individuals every month with way of life, movie star, meals, well being & wellness, sports activities, and out of doors verticals together with the Parade Media, AMG/Parade Sports activities, Relish, Spry Dwelling and different way of life and out of doors manufacturers. The Firm expects to finish the acquisition shortly.
- Within the first quarter of fiscal 2022, The Enviornment Group uplisted its widespread inventory to the NYSE American below the image “AREN.” Simultaneous with the uplisting, the Firm accomplished an underwritten public providing of 4,181,603 shares of its widespread inventory, which included the partial train of the underwriter’s overallotment, at a public providing value of $8.25 per share. This resulted in internet proceeds to The Enviornment Group of $31.5 million, after deducting underwriting reductions and commissions and different providing bills.
- In February 2022, the Firm recorded greater than 111 million distinctive guests, in keeping with ComScore. The Enviornment Group reached the #34 spot within the U.S. rankings, up 40 spots from February 2021, and its sports activities vertical, led by Sports activities Illustrated, reached #4 within the sports activities class. In February 2022, the Sports activities Illustrated Media Group reached greater than 86 million digital customers, greater than tripling year-over-year.
- “The Enviornment Group ‘Playbook,’” our plan to characteristic premium content material and skilled evaluation, in addition to viewers and editorial methods designed to effectively ship sturdy experiences to audiences throughout platforms, has pushed important current progress for Sports activities Illustrated, The Spun, TheStreet and PetHelpful, with plans to roll out throughout further properties and writer companions within the coming 12 months.
- Sports activities Illustrated now has the #1 share of voice on Fb amongst sports activities publishers for linked tales, in keeping with knowledge from CrowdTangle.
- Because the departure of Jim Cramer from TheStreet in October 2021, The Enviornment Group has grown customers on the monetary website by 249% to greater than 17 million month-to-month distinctive guests, in keeping with ComScore knowledge just lately launched in February 2022 and has seen its engagements at Fb develop by greater than 520% year-over-year for the primary two months of 2022, in keeping with knowledge from ListenFirst.
Monetary Outcomes for the Three Months Ended December 31, 2021 In comparison with the Three Months Ended December 31, 2020
Income was $61.2 million for the fourth quarter of fiscal 2021, a rise of 44% in comparison with $42.4 million within the fourth quarter of fiscal 2020. The rise was primarily attributable to a 50% enhance in complete digital income to $33.3 million within the fourth quarter of 2021, which included an $11.5 million, or 97%, enhance in digital promoting income. Digital promoting progress was pushed by greater visitors throughout all of our properties within the fourth quarter of fiscal 2021 as in comparison with the prior 12 months. As well as, complete print income elevated 38% to $27.9 million within the fourth quarter of fiscal 2021 from $20.2 million within the fourth quarter of fiscal 2020, primarily pushed by a 56% enhance in print subscription income reflecting the profitable drive to extend subscribers within the fourth quarter of 2020 and the diminishing impact of acquisition accounting changes on the subscribers that existed once we started working the Sports activities Illustrated media enterprise.
Gross revenue greater than doubled within the fourth quarter of fiscal 2021 to $34.2 million, representing a 56% gross revenue proportion as in comparison with a gross revenue of $15.7 million, representing a 37% gross revenue proportion for the fourth quarter of 2020. Price of income solely elevated by 1% within the fourth quarter of fiscal 2021 even with a 44% enhance in income period-over-period, reflecting a excessive gross revenue from our rising digital income.
Whole working bills had been $51.1 million within the fourth quarter of 2021 in comparison with $31.2 million within the fourth quarter of 2020. The rise was attributable to a rise in circulation prices of $9.2 million reflecting the marketing campaign to extend Sports activities Illustrated subscription within the fourth quarter of 2020 and stock-based compensation of $5.4 million with the remaining bills attributable to elevated funding in viewers growth, knowledge analytics and expertise personnel.
Internet loss improved to $19.1 million for the fourth quarter of 2021 as in comparison with $22.0 million within the prior 12 months interval. The fourth quarter of 2021 included $18.5 million of non-cash fees as in comparison with $16.2 million of non-cash fees within the fourth quarter of the prior 12 months.
Adjusted EBITDA for the fourth quarter of fiscal 2021 was $1.1 million, in comparison with a lack of $2.1 for the fourth quarter of fiscal 2020, representing a $3.3 million enchancment quarter-over-quarter. This mirrored the power of our enterprise operations as mentioned above, unique of the $5.4 million enhance in stock-based compensation.
Adjusted EBITDA is a non-GAAP monetary measure. A disclaimer and reconciliation are supplied under.
Monetary Outcomes for the 12 months Ended December 31, 2021 In comparison with the 12 months Ended December 31, 2020
Income was $189.1 million for fiscal 2021 as in comparison with $128.0 million within the prior 12 months, representing a rise of 48% year-over-year. The rise was primarily attributable to a 49% enhance in complete digital income to $101.0 million for fiscal 2021 pushed by an 81% enhance in digital promoting income. The rise in digital promoting income was primarily associated to consumer and viewers progress in our Sports activities vertical, the addition of The Spun and $9.9 million from the continued power of our Sports activities Illustrated enterprise. As well as, complete print income elevated 46% to $88.1 million for fiscal 2021 from $60.3 million within the prior 12 months, primarily pushed by a 56% enhance in print subscription income reflecting the profitable drive to extend subscribers within the fourth quarter of 2020 and the diminishing impact of acquisition accounting changes on the subscribers that existed once we started working the Sports activities Illustrated media enterprise.
Gross revenue for the 12 months ended December 31, 2021, was $78.2 million, representing a gross revenue proportion of 41%, in comparison with gross revenue of $25.0 million, or a gross revenue proportion of 19% within the prior 12 months. The advance in gross revenue is a results of a lower in writer accomplice income shares from 56% of digital promoting income in fiscal 2020 to 34% in fiscal 2021 associated to a strategic shift to get rid of most writer accomplice ensures close to the tip of fiscal 2020 and the excessive contribution margin of digital promoting.
Whole working bills had been $162.4 million in fiscal 2021, in comparison with $96.2 million in fiscal 2020. The rise was attributable to a rise in circulation prices of $31.6 million, stock-based compensation of $15.6 million, and a $7.3 million expense associated to the termination and give up of our New York Metropolis workplace area with the remaining bills attributable to elevated funding in viewers growth, knowledge analytics and expertise personnel.
Internet loss remained comparatively flat year-over-year at $89.9 million for fiscal 2021, in comparison with internet lack of $89.2 million for fiscal 2020. The Firm recorded $68.4 million of non-cash fees, representing 76% of the present 12 months internet loss. Throughout fiscal 2020, the Firm recorded $57.0 million of non-cash fees.
Adjusted EBITDA for fiscal 2021 was a lack of $12.1 million, in comparison with a lack of $23.2 for fiscal 2020 primarily associated to the $15.6 million enhance in stock-based compensation in fiscal 2021.
Adjusted EBITDA is a non-GAAP monetary measure. A disclaimer and reconciliation are supplied under.
Stability Sheet and Liquidity as of December 31, 2021
Money and money equivalents had been $9.9 million at December 31, 2021, in comparison with $ 9.5 million at December 31, 2020. Subsequent to the tip of fiscal 2021, the Firm raised $31.5 million in internet proceeds from a agency dedication underwritten providing of its widespread inventory.
For the 12 months ended December 31, 2021, internet money utilized in working actions was $14.7 million, as in comparison with $32.3 million for the prior 12 months, a $17.6 million enchancment. The advance was primarily a results of the rise in income which led to extra money collections and a common enchancment in our working capital effectivity.
Convention Name
Ross Levinsohn, The Enviornment Group’s Chief Govt Officer, and Doug Smith, Chief Monetary Officer, will host a convention name to debate these outcomes at this time at 4:30 p.m. ET. To entry the decision, please dial 888-506-0062 (toll free) or 973-528-0011 and if requested, reference convention ID 818438. The convention name may even be webcast stay on the Investor Relations part of The Enviornment Group’s web site at https://buyers.thearenagroup.internet/news-and-events/occasions.
Following the conclusion of the stay name, a replay of the webcast might be out there on the Investor Relations part of the Firm’s web site for no less than 90 days. A telephonic replay of the convention name may even be out there from 7 p.m. ET on March 28, 2022 till 11:59 p.m. ET on April 11, 2022 by dialing 877-481-4010 (United States) or 919-882-2331 (worldwide) and utilizing the passcode 44970.
About The Enviornment Group
The Enviornment Group creates sturdy digital locations that delight customers with highly effective journalism and information in regards to the issues they love – their favourite sports activities groups, recommendation on investing, the within scoop on private finance, and the newest on way of life necessities. With highly effective expertise, editorial experience, knowledge administration, and advertising savvy, the transformative firm permits manufacturers like Sports activities Illustrated and TheStreet to ship extremely related content material and experiences that buyers love. To study extra, go to www.thearenagroup.internet.
Use of Non-GAAP Monetary Measures
We report our monetary leads to accordance with usually accepted accounting rules in the USA of America (“GAAP”); nonetheless, administration believes that sure non-GAAP monetary measures present customers of our monetary info with helpful supplemental info that permits a greater comparability of our efficiency throughout intervals. This press launch consists of references to Adjusted EBITDA, which is a non-GAAP monetary measure. We imagine Adjusted EBITDA gives visibility to the underlying persevering with working efficiency by excluding the impression of sure gadgets which are noncash in nature or not associated to our core enterprise operations. We calculate Adjusted EBITDA as internet loss, adjusted for (i) curiosity expense (internet), (ii) earnings taxes, (iii) depreciation and amortization, (iv) stock-based compensation, (v) change in spinoff valuations, (vi) liquidated damages, (vii) loss on disposition of belongings, (viii) loss on impairment of lease, (ix) loss on lease termination, (x) acquire upon debt extinguishment, (xi) skilled and vendor charges, and (xii) worker restructuring funds.
Our non-GAAP Adjusted EBITDA is probably not corresponding to a equally titled measure utilized by different firms, has limitations as an analytical instrument, and shouldn’t be thought-about in isolation, or as an alternative choice to evaluation of our working outcomes as reported below GAAP. Moreover, we don’t contemplate our non-GAAP Adjusted EBITDA as superior to, or an alternative choice to, the equal measures calculated and offered in accordance with GAAP.
Ahead-Trying Statements
This press launch consists of statements that represent forward-looking statements. Ahead-looking statements could also be recognized by way of phrases reminiscent of “forecast,” “steering,” “plan,” “estimate,” “will,” “would,” “challenge,” “keep,” “intend,” “anticipate,” “anticipate,” “prospect,” “technique,” “future,” “possible,” “could,” “ought to,” “imagine,” “proceed,” “alternative,” “potential,” and different comparable expressions that predict or point out future occasions or developments or that aren’t statements of historic issues, and embody, for instance, statements associated to the anticipated results on the Firm’s enterprise from the COVID-19 pandemic. These forward-looking statements are primarily based on info out there on the time the statements are made and/or administration’s good religion perception as of that point with respect to future occasions, and are topic to dangers and uncertainties that might trigger precise outcomes to vary materially from these expressed in or steered by the forward-looking statements. Elements that might trigger or contribute to such variations embody, however aren’t restricted to, the length and scope of the COVID-19 pandemic and impression on the demand for the Firm merchandise; the power of the Firm to increase its verticals; the Firm’s skill to develop its subscribers; the Firm’s skill to develop its promoting income; common financial uncertainty in key world markets and a worsening of world financial circumstances or low ranges of financial progress; the consequences of steps that the Firm may take to scale back working prices; the shortcoming of the Firm to maintain worthwhile gross sales progress; circumstances or developments that will make the Firm unable to implement or notice the anticipated advantages, or that will enhance the prices, of its present and deliberate enterprise initiatives; and people components detailed by The Enviornment Group Holdings, Inc. in its public filings with the Securities and Alternate Fee, together with its Annual Report on Type 10-Ok and Quarterly Reviews on Type 10-Q. Ought to a number of of those dangers, uncertainties, or info materialize, or ought to underlying assumptions show incorrect, precise outcomes could differ materially from these indicated or anticipated by the forward-looking statements contained herein. Accordingly, you might be cautioned to not place undue reliance on these forward-looking statements, which converse solely as of the date they’re made. Ahead-looking statements shouldn’t be learn as a assure of future efficiency or outcomes and won’t essentially be correct indications of the occasions at, or by, which such efficiency or outcomes might be achieved. Besides as required below the federal securities legal guidelines and the principles and laws of the Securities and Alternate Fee, we do not need any intention or obligation to replace publicly any forward-looking statements, whether or not on account of new info, future occasions, or in any other case.
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THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) |
||||||||
|
|
As of December 31, |
|||||||
|
|
|
2021 |
|
2020 |
||||
|
Property |
|
|
|
|
|
|
||
|
Present belongings: |
|
|
|
|
|
|
||
|
Money and money equivalents |
|
$ |
9,349,020 |
|
|
$ |
9,033,872 |
|
|
Restricted money |
|
|
501,780 |
|
|
|
500,809 |
|
|
Accounts receivable, internet |
|
|
21,659,847 |
|
|
|
16,497,626 |
|
|
Subscription acquisition prices, present portion |
|
|
30,162,524 |
|
|
|
28,146,895 |
|
|
Royalty charges, present portion |
|
|
11,250,000 |
|
|
|
15,000,000 |
|
|
Prepayments and different present belongings |
|
|
4,747,847 |
|
|
|
4,667,263 |
|
|
Whole present belongings |
|
|
77,671,018 |
|
|
|
73,846,465 |
|
|
Property and gear, internet |
|
|
635,768 |
|
|
|
1,129,438 |
|
|
Working lease right-of-use belongings |
|
|
528,431 |
|
|
|
18,292,196 |
|
|
Platform growth, internet |
|
|
9,298,795 |
|
|
|
7,355,608 |
|
|
Royalty charges, internet of present portion |
|
|
– |
|
|
|
11,250,000 |
|
|
Subscription acquisition prices, internet of present portion |
|
|
8,234,553 |
|
|
|
13,358,585 |
|
|
Acquired and different intangible belongings, internet |
|
|
57,356,497 |
|
|
|
71,501,835 |
|
|
Different long-term belongings |
|
|
639,151 |
|
|
|
1,330,812 |
|
|
Goodwill |
|
|
19,618,667 |
|
|
|
16,139,377 |
|
|
Whole belongings |
|
$ |
173,982,880 |
|
|
$ |
214,204,316 |
|
|
Liabilities, mezzanine fairness and stockholders’ deficiency |
|
|
|
|
|
|
||
|
Present liabilities: |
|
|
|
|
|
|
||
|
Accounts payable |
|
$ |
11,981,852 |
|
|
$ |
8,228,977 |
|
|
Accrued bills and different |
|
|
24,010,569 |
|
|
|
14,718,193 |
|
|
Line of credit score |
|
|
11,988,194 |
|
|
|
7,178,791 |
|
|
Unearned income |
|
|
54,029,657 |
|
|
|
61,625,676 |
|
|
Subscription refund legal responsibility |
|
|
3,086,799 |
|
|
|
4,035,531 |
|
|
Working lease liabilities |
|
|
373,859 |
|
|
|
1,059,671 |
|
|
Liquidated damages payable |
|
|
5,197,182 |
|
|
|
9,568,091 |
|
|
Present portion of long-term debt |
|
|
5,744,303 |
|
|
|
– |
|
|
Embedded spinoff liabilities |
|
|
– |
|
|
|
1,147,895 |
|
|
Whole present liabilities |
|
|
116,412,415 |
|
|
|
107,562,825 |
|
|
Unearned income, internet of present portion |
|
|
15,275,892 |
|
|
|
23,498,597 |
|
|
Restricted inventory liabilities, internet of present portion |
|
|
– |
|
|
|
1,995,810 |
|
|
Working lease liabilities, internet of present portion |
|
|
785,320 |
|
|
|
19,886,083 |
|
|
Liquidating damages payable, internet of present portion |
|
|
7,008,273 |
|
|
|
– |
|
|
Different long-term liabilities |
|
|
7,556,265 |
|
|
|
753,365 |
|
|
Deferred tax liabilities |
|
|
362,118 |
|
|
|
210,832 |
|
|
Lengthy-term debt, internet of present portion |
|
|
64,372,511 |
|
|
|
62,194,272 |
|
|
Whole liabilities |
|
|
211,772,794 |
|
|
|
216,101,784 |
|
|
Commitments and contingencies |
|
|
|
|
|
|
||
|
Mezzanine fairness: |
|
|
|
|
|
|
||
|
Sequence G redeemable and convertible most popular inventory, $0.01 par worth, $1,000 per share liquidation worth and 1,800 shares designated; combination liquidation worth: $168,496; Sequence G shares issued and excellent: 168.496; widespread shares issuable upon conversion: 8,582 at December 31, 2021 and 2020 |
|
|
168,496 |
|
|
|
168,496 |
|
|
Sequence H convertible most popular inventory, $0.01 par worth, $1,000 per share liquidation worth and 23,100 shares designated; combination liquidation worth: $15,066,000 and $19,596,000; Sequence H shares issued and excellent: 15,066 and 19,596; widespread shares issuable upon conversion: 2,075,200 and a couple of,699,312 at December 31, 2021 and 2020, respectively |
|
|
13,717,496 |
|
|
|
18,247,496 |
|
|
Whole mezzanine fairness |
|
|
13,885,992 |
|
|
|
18,415,992 |
|
|
Stockholders’ deficiency: |
|
|
|
|
|
|
||
|
Widespread inventory, $0.01 par worth, licensed 1,000,000,000 shares: issued and excellent; 12,632,939 and 10,412,965 shares December 31, 2021 and 2020, respectively |
|
|
126,329 |
|
|
|
104,129 |
|
|
Widespread inventory to be issued |
|
|
491 |
|
|
|
491 |
|
|
Further paid-in capital |
|
|
200,410,213 |
|
|
|
141,855,206 |
|
|
Accrued deficit |
|
|
(252,212,939 |
) |
|
|
(162,273,286 |
) |
|
Whole stockholders’ deficiency |
|
|
(51,675,906 |
) |
|
|
(20,313,460 |
) |
|
Whole liabilities, mezzanine fairness and stockholders’ deficiency |
|
$ |
173,982,880 |
|
|
$ |
214,204,316 |
|
|
THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
||||||||||||||||
|
|
|
Three Months Ended December 31, |
|
12 months Ended December 31, |
||||||||||||
|
|
|
2021 |
2020 |
|
2021 |
|
2020 |
|||||||||
|
Income |
|
$ |
61,204,833 |
|
|
$ |
42,438,611 |
|
|
$ |
189,140,334 |
|
|
$ |
128,032,397 |
|
|
Price of income (1) |
|
|
26,999,686 |
|
|
|
26,741,492 |
|
|
|
110,977,736 |
|
|
|
103,063,445 |
|
|
Gross revenue |
|
|
34,205,147 |
|
|
|
15,697,119 |
|
|
78,162,598 |
|
|
|
24,968,952 |
|
|
|
Working bills |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Promoting and advertising |
|
|
27,568,704 |
|
|
|
15,891,057 |
|
|
|
82,691,061 |
|
|
|
43,589,239 |
|
|
Common and administrative |
|
|
18,418,937 |
|
|
|
11,154,347 |
|
|
|
54,400,720 |
|
|
|
36,007,238 |
|
|
Depreciation and amortization |
|
|
4,365,276 |
|
|
|
4,003,485 |
|
|
|
16,347,274 |
|
|
|
16,280,475 |
|
|
Loss on disposition of belongings |
|
|
288,388 |
|
|
|
174,010 |
|
|
|
1,192,310 |
|
|
|
279,133 |
|
|
Loss on impairment of lease |
|
|
466,356 |
|
|
|
– |
|
|
|
466,356 |
|
|
|
– |
|
|
Loss on termination of lease |
|
|
– |
|
|
|
– |
|
|
|
7,344,655 |
|
|
|
– |
|
|
Whole working bills |
|
|
51,107,661 |
|
|
|
31,222,899 |
|
|
|
162,442,376 |
|
|
|
96,156,085 |
|
|
Loss from operations |
|
|
(16,902,514 |
) |
|
|
(15,525,780 |
) |
|
(84,279,778 |
) |
|
|
(71,187,133 |
) |
|
|
Different (bills) earnings |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Change in valuation of warrant spinoff liabilities |
|
|
(462.320 |
) |
|
|
631,215 |
|
|
|
34,492 |
|
|
|
496,305 |
|
|
Change in valuation of embedded spinoff liabilities |
|
|
– |
|
|
|
398,004 |
|
|
|
– |
|
|
|
2,571,004 |
|
|
Loss on conversion of convertible debt |
|
|
– |
|
|
|
(3,297,539 |
) |
|
|
– |
|
|
|
(3,297,539 |
) |
|
Curiosity expense |
|
|
(2,759,301 |
) |
|
|
(4,327,902 |
) |
|
|
(10,454,618 |
) |
|
|
(16,497,217 |
) |
|
Curiosity earnings |
|
|
6,013 |
|
|
|
376,527 |
|
|
|
6,484 |
|
|
|
381,026 |
|
|
Liquidated damages |
|
|
(439,749 |
) |
|
|
– |
|
|
|
(2,637,364 |
) |
|
|
(1,487,577 |
) |
|
Acquire upon debt extinguishment |
|
|
– |
|
|
|
– |
|
|
|
5,716,697 |
|
|
|
– |
|
|
Different expense |
|
|
– |
|
|
|
(73,272 |
) |
|
|
– |
|
|
|
– |
|
|
Whole different bills |
|
|
(3,655,357 |
) |
|
|
(6,292,967 |
) |
|
|
(7,334,309 |
) |
|
|
(17,833,998 |
) |
|
Loss earlier than earnings taxes |
|
|
(20,557,871 |
) |
|
|
(21,818,747 |
) |
|
|
(91,614,087 |
) |
|
|
(89,021,131 |
) |
|
Revenue tax profit (provision) |
|
|
1,444,735 |
|
|
|
(210,832 |
) |
|
|
1,674,434 |
|
|
|
(210,832 |
) |
|
Internet loss |
|
|
(19,113,136 |
) |
|
|
(22,029,579 |
) |
|
|
(89,939,653 |
) |
|
|
(89,231,963 |
) |
|
Deemed dividend on convertible most popular inventory |
|
|
– |
|
|
|
(15,509,932 |
) |
|
|
– |
|
|
|
(15,642,595 |
) |
|
Internet loss attributable to widespread stockholders |
|
$ |
(19,113,136 |
) |
|
$ |
(37,539,511 |
) |
|
$ |
(89,939,653 |
) |
|
$ |
(104,874,558 |
) |
|
Fundamental and diluted internet loss per widespread share |
|
$ |
(1.57 |
) |
|
$ |
(13.62 |
) |
|
$ |
(7.87 |
) |
|
$ |
(50.18 |
) |
|
Weighted common variety of shares excellent – primary and diluted |
|
|
12,160,845 |
|
|
|
2,756,010 |
|
|
|
11,429,740 |
|
|
|
2,090,047 |
|
|
(1) |
Contains amortization for developed expertise and platform growth for the three months ended December 31, 2021 and 2020 of $2,263,425 and $2,202,333 and for the years ended December 31, 2021 and 2020 of $8,829,025 and $8,550,952, respectively |
|
THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) |
||||||||
|
|
|
Years Ended December 31, |
||||||
|
|
|
2021 |
|
2020 |
||||
|
Money flows from working actions |
|
|
|
|
|
|
||
|
Internet loss |
|
$ |
(89,939,653 |
) |
|
$ |
(89,231,963 |
) |
|
Changes to reconcile internet loss to internet money utilized in working actions: |
|
|
|
|
|
|
||
|
Depreciation of property and gear |
|
|
443,422 |
|
|
|
638,796 |
|
|
Amortization of platform growth and intangible belongings |
|
|
24,732,877 |
|
|
|
24,192,631 |
|
|
Loss on disposition of belongings |
|
|
1,192,310 |
|
|
|
279,133 |
|
|
Loss on impairment of lease |
|
|
466,356 |
|
|
|
– |
|
|
Loss on termination of lease |
|
|
7,344,655 |
|
|
|
– |
|
|
Acquire upon debt extinguishment |
|
|
(5,716,697 |
) |
|
|
– |
|
|
Amortization of debt reductions |
|
|
2,105,536 |
|
|
|
6,607,212 |
|
|
Change in valuation of warrant spinoff liabilities |
|
|
(34,492 |
) |
|
|
(496,305 |
) |
|
Change in valuation of embedded spinoff liabilities |
|
|
– |
|
|
|
(2,571,004 |
) |
|
Loss on conversion of 12% convertible debentures |
|
|
– |
|
|
|
3,297,539 |
|
|
Accrued and noncash transformed curiosity |
|
|
6,956,182 |
|
|
|
9,244,324 |
|
|
Liquidated damages |
|
|
2,637,364 |
|
|
|
1,487,577 |
|
|
Inventory-based compensation |
|
|
30,493,521 |
|
|
|
14,641,181 |
|
|
Deferred earnings taxes |
|
|
(1,674,434 |
) |
|
|
210,832 |
|
|
Different |
|
|
(499,196 |
) |
|
|
(524,418 |
) |
|
Change in working belongings and liabilities internet of impact of enterprise combos: |
|
|
|
|
|
|
||
|
Accounts receivable |
|
|
(2,891,000 |
) |
|
|
362,460 |
|
|
Subscription acquisition prices |
|
|
3,108,403 |
|
|
|
(34,945,422 |
) |
|
Royalty charges |
|
|
15,000,000 |
|
|
|
15,000,000 |
|
|
Prepayments and different present belongings |
|
|
48,983 |
|
|
|
(356,528 |
) |
|
Different long-term belongings |
|
|
691,661 |
|
|
|
(245,525 |
) |
|
Accounts payable |
|
|
3,752,875 |
|
|
|
(1,404,703 |
) |
|
Accrued bills and different |
7,474,423 |
(3,392,507 |
) | |||||
|
Unearned income |
|
|
(15,818,724 |
) |
|
|
21,695,088 |
|
|
Subscription refund legal responsibility |
|
|
(948,732 |
) |
|
|
891,359 |
|
|
Different long-term liabilities |
|
|
(2,489,166 |
) |
|
|
511,055 |
|
|
Working lease liabilities |
|
|
(1,165,863 |
) |
|
|
1,814,601 |
|
|
Internet money utilized in working actions |
|
|
(14,729,389 |
) |
|
|
(32,294,587 |
) |
|
Money flows from investing actions |
|
|
|
|
|
|
||
|
Purchases of property and gear |
|
|
(376,635 |
) |
|
|
(1,212,003 |
) |
|
Capitalized platform growth |
|
|
(4,818,866 |
) |
|
|
(3,750,541 |
) |
|
Proceeds from sale of intangible asset |
|
|
– |
|
|
|
350,000 |
|
|
Funds for acquisition of companies, internet of money |
|
|
(7,950,457 |
) |
|
|
(315,289 |
) |
|
Internet money utilized in investing actions |
|
|
(13,145,958 |
) |
|
|
(4,927,833 |
) |
|
Money flows from financing actions |
|
|
|
|
|
|
||
|
Proceeds from long-term debt |
|
|
5,086,135 |
|
|
|
11,702,725 |
|
|
Proceeds, internet of repayments, below line of credit score |
|
|
4,809,403 |
|
|
|
7,178,791 |
|
|
Proceeds from widespread inventory personal placement |
|
|
20,005,000 |
|
|
|
– |
|
|
Fee of debt issuance prices on long-term debt |
|
|
– |
|
|
|
(560,500 |
) |
|
Proceeds from issuance of Sequence H convertible most popular inventory |
|
|
– |
|
|
|
113,000 |
|
|
Repayments of convertible debt |
|
|
– |
|
|
|
(1,130,903 |
) |
|
Proceeds from train of widespread inventory choices |
|
|
– |
|
|
|
3,767 |
|
|
Proceeds from issuance of Sequence J convertible most popular inventory |
|
|
– |
|
|
|
6,000,000 |
|
|
Proceeds from issuance of Sequence Ok convertible most popular inventory |
|
|
– |
|
|
|
14,675,000 |
|
|
Funds of issuance prices from widespread inventory personal placement |
|
|
(167,243 |
) |
|
|
– |
|
|
Fee for taxes associated to repurchase of restricted widespread inventory |
|
|
(70,238 |
) |
|
|
(520,444 |
) |
|
Fee of restricted inventory liabilities |
|
|
(1,471,591 |
) |
|
|
(177,425 |
) |
|
Internet money supplied by financing actions |
|
|
28,191,466 |
|
|
|
37,284,011 |
|
|
Internet enhance in money, money equivalents, and restricted money |
|
|
316,119 |
|
|
|
61,591 |
|
|
Money, money equivalents, and restricted money – starting of 12 months |
|
|
9,534,681 |
|
|
|
9,473,090 |
|
|
Money, money equivalents, and restricted money – finish of 12 months |
|
$ |
9,850,800 |
|
|
$ |
9,534,681 |
|
|
Supplemental disclosure of money move info |
|
|
|
|
|
|
||
|
Money paid for curiosity |
|
$ |
1,392,900 |
|
|
$ |
645,681 |
|
|
Money paid for earnings taxes |
|
|
– |
|
|
|
– |
|
|
Noncash investing and financing actions |
|
|
|
|
|
|
||
|
Reclassification of stock-based compensation to platform growth |
|
$ |
2,045,264 |
|
|
$ |
1,608,995 |
|
|
Issuance of widespread inventory in reference to skilled providers |
|
|
125,000 |
|
|
|
– |
|
|
Deferred money funds in reference to acquisition of The Spun |
|
|
905,109 |
|
|
|
– |
|
|
Assumption of liabilities in reference to acquisition of The Spun |
|
|
84,732 |
|
|
|
– |
|
|
Dedication payment on delayed draw time period word in accrued bills and different |
|
|
508,614 |
|
|
|
– |
|
|
Reclassification of warrants to fairness |
|
|
1,113,403 |
|
|
|
– |
|
|
Internet train of widespread inventory choices with change of widespread inventory |
|
|
39 |
|
|
|
– |
|
|
Debt low cost on long-term debt |
|
|
– |
|
|
|
913,865 |
|
|
Restricted widespread inventory items issued in reference to acquisition of LiftIgniter |
|
|
– |
|
|
|
500,000 |
|
|
Assumption of liabilities in reference to acquisition of LiftIgniter |
|
|
– |
|
|
|
140,381 |
|
|
Restricted inventory issued in reference to acquisition of Fulltime Fantasy |
|
|
502,500 |
|
|
|
– |
|
|
Deferred money funds in reference to acquisition of Fulltime Fantasy |
|
|
419,387 |
|
|
|
– |
|
|
Conversion of convertible debt into widespread inventory |
|
|
– |
|
|
|
21,402,488 |
|
|
Conversion of embedded spinoff liabilities into widespread inventory |
|
|
– |
|
|
|
10,929,996 |
|
|
Conversion of Sequence I convertible most popular inventory into widespread inventory |
|
|
– |
|
|
|
19,699,742 |
|
|
Conversion of Sequence J convertible most popular inventory into widespread inventory |
|
|
– |
|
|
|
23,739,996 |
|
|
Conversion of Sequence Ok convertible most popular inventory into widespread inventory |
|
|
– |
|
|
|
17,481,500 |
|
|
Deemed dividend on Sequence H convertible most popular inventory |
|
|
– |
|
|
|
502,000 |
|
|
Deemed dividend on Sequence I convertible most popular inventory |
|
|
– |
|
|
|
5,082,000 |
|
|
Deemed dividend on Sequence J convertible most popular inventory |
|
|
– |
|
|
|
586,545 |
|
|
Deemed dividend on Sequence Ok convertible most popular inventory |
|
|
– |
|
|
|
9,472,050 |
|
|
Fee of long-term debt for issuance of Sequence Ok convertible most popular inventory |
|
|
– |
|
|
|
3,367,000 |
|
|
Fee of promissory word for issuance for Sequence H convertible most popular inventory |
|
|
– |
|
|
|
389,000 |
|
|
THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES NET LOSS TO ADJUSTED EBITDA RECONCILIATION (unaudited) |
||||||||||||||||
|
The next desk presents a reconciliation of Adjusted EBITDA to internet loss, which is probably the most straight comparable GAAP measure, for the intervals indicated: |
||||||||||||||||
|
|
|
Three Months Ended December 31, |
|
Years Ended December 31, |
||||||||||||
|
|
|
2021 |
2020 |
|
2021 |
|
2020 |
|||||||||
|
Internet loss |
|
$ |
(19,113,136 |
) |
|
$ |
(22,029,579 |
) |
|
$ |
(89,939,653 |
) |
|
$ |
(89,231,963 |
) |
|
Add (deduct): |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Curiosity expense, internet (1) |
|
|
2,753,288 |
|
|
|
3,951,375 |
|
|
10,448,134 |
|
|
|
16,116,191 |
|
|
|
Revenue tax (profit) provision |
|
|
(1,444,735 |
) |
|
|
210,832 |
|
|
|
(1,674,434 |
) |
|
|
210,832 |
|
|
Depreciation and amortization (2) |
|
|
6,628,701 |
|
|
|
6,205,818 |
|
|
|
25,176,299 |
|
|
|
24,831,427 |
|
|
Inventory-based compensation (3) |
|
|
8,805,295 |
|
|
|
3,455,228 |
|
|
|
30,493,521 |
|
|
|
14,641,181 |
|
|
Change in spinoff valuations |
|
|
462,320 |
|
|
|
(1,029,219 |
) |
|
|
(34,492 |
) |
|
|
(3,067,309 |
) |
|
Liquidated damages (4) |
|
|
439,749 |
|
|
|
– |
|
|
|
2,637,364 |
|
|
|
1,487,577 |
|
|
Loss on disposition of belongings (5) |
|
|
329,868 |
|
|
|
174,010 |
|
|
|
1,192,310 |
|
|
|
279,133 |
|
|
Loss on impairment of lease (6) |
|
|
466,356 |
|
|
|
– |
|
|
|
466,356 |
|
|
|
– |
|
|
Loss on termination of lease (7) |
|
|
– |
|
|
|
– |
|
|
|
7,344,655 |
|
|
|
– |
|
|
Loss on conversion of convertible debt |
|
|
– |
|
|
|
3,297,539 |
|
|
|
– |
|
|
|
3,297,539 |
|
|
Acquire upon debt extinguishment (8) |
|
|
– |
|
|
|
– |
|
|
|
(5,716,697 |
) |
|
|
– |
|
|
Skilled and vendor charges (9) |
|
|
1,748,383 |
|
|
|
3,398,427 |
|
|
|
6,900,778 |
|
|
|
5,704,606 |
|
|
Worker restructuring funds (10) |
|
|
65,218 |
|
|
|
253,299 |
|
|
|
645,200 |
|
|
|
2,536,989 |
|
|
Adjusted EBITDA |
|
$ |
1,141,307 |
|
|
$ |
(2,112,270 |
) |
|
$ |
(12,060,659 |
) |
|
$ |
(23,193,797 |
) |
|
(1) |
Represents curiosity expense associated to our capital construction. Curiosity expense varies over time attributable to a wide range of financing transactions. Traders ought to word that curiosity expense will recur in future intervals. |
|
|
(2) |
Represents depreciation and amortization associated to our developed expertise and Platform included inside price of revenues. We imagine (i) the quantity of depreciation and amortization expense in any particular interval could in a roundabout way correlate to the underlying efficiency of our enterprise operations and (ii) such bills can differ considerably between intervals on account of new acquisitions and full amortization of beforehand acquired tangible and intangible belongings. Traders ought to word that the usage of tangible and intangible belongings contributed to income within the intervals offered and can contribute to future income era and must also word that such expense will recur in future intervals. |
|
|
(3) |
Represents noncash prices arising from the grant of stock-based awards to workers, consultants and administrators. We imagine that excluding the impact of stock-based compensation from Adjusted EBITDA assists administration and buyers in making period-to-period comparisons in our working efficiency as a result of (i) the quantity of such bills in any particular interval could in a roundabout way correlate to the underlying efficiency of our enterprise operations, and (ii) such bills can differ considerably between intervals on account of the timing of grants of latest stock-based awards, together with grants in reference to acquisitions. Moreover, we imagine that excluding stock-based compensation from Adjusted EBITDA assists administration and buyers in making significant comparisons between our working efficiency and the working efficiency of different firms that will use totally different types of worker compensation or totally different valuation methodologies for his or her stock-based compensation. Traders ought to word that stock-based compensation is a key incentive provided to workers whose efforts contributed to the working leads to the intervals offered and are anticipated to contribute to working leads to future intervals. Traders must also word that such bills will recur sooner or later. |
|
|
(4) |
Represents damages we owe to sure of our buyers in personal placements choices performed in fiscal years 2018 by 2020, pursuant to which we agreed to sure covenants within the respective securities buy agreements and registration rights agreements, together with the submitting of resale registration statements and turning into present in our reporting obligations, which we weren’t in a position to well timed meet. |
|
|
(5) |
Represents our disposition of sure belongings associated to the choice to not lease workplace area and different associated disposition of belongings that not are helpful. |
|
|
(6) |
Represents the web loss for our right-of-use asset associated to our lease in Santa Monica and associated sublease of the workplace area primarily based on our determination to not lease workplace area. |
|
|
(7) |
Represents our loss associated to the give up and termination of our lease of workplace area positioned in New York primarily based on our determination to not lease workplace area. |
|
|
(8) |
Represents a acquire upon extinguishment of the Payroll Safety Program Mortgage. |
|
|
(9) |
Represents skilled and vendor charges recorded in reference to providers supplied by consultants, accountants, attorneys, and different distributors associated to (i) the preparation of periodic reviews to ensure that us to develop into present in our reporting obligations (“Delinquent Reporting Obligations Companies”), (ii) up-list to a nationwide securities change, (iii) contemplated and accomplished acquisitions, (iv) private and non-private choices of our securities and different financings, and (v) stockholder disputes and the implementation of our Rights Settlement. With respect to the Delinquent Reporting Obligations Companies, we incurred skilled and vendor charges in fiscal 2021 and 2020 associated to the preparation of our annual reviews for fiscal years 2018, 2019 (which contained the monetary info for the quarterly intervals throughout fiscal 2019), and 2020 and quarterly reviews for the quarters in fiscal 2020 and the primary and second quarters in fiscal 2021, all of which reviews had been filed throughout fiscal 2021. The quantity of charges incurred in reference to the Delinquent Reporting Obligations Companies is adjusted primarily based on our greatest estimate of the quantity we anticipate we’d ordinarily incur to satisfy our reporting obligations pursuant to the Alternate Act. |
|
|
(10) |
Represents (i) severance funds paid in reference to COVID-19 workforce reductions in fiscal 2020 and (ii) severance and different settlement funds paid in reference to worker and management adjustments in fiscal 2020 and 2021. |
