Big Stick Media Corporation
TSX VENTURE : BSM

Big Stick Media Corporation

October 07, 2009 17:17 ET

Big Stick Media Corporation Announces Financial Results for the Quarter Ended August 31, 2009

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 7, 2009) - Big Stick Media Corporation (TSX VENTURE:BSM)("BSM" or the "Company") announces today its financial results for the quarter ended August 31, 2009.

For the quarter ended August 31, 2009, the Company incurred a net loss of $1,583,200 versus a net loss of $1,067,444 for the quarter ended August 31, 2008. The net loss figures include various non-cash accounting items including amortization expense, stock option compensation expense, accredited interest expense, losses on asset dispositions and net foreign exchange gains and losses emanating from the movement of the U.S. dollar. Excluding the effects of the non-cash and one-time items as well as the ongoing cash interest expense, the modified EBITDA for the third quarter of fiscal 2009 was $114,916 versus $363,476 for the corresponding quarter of fiscal 2008.

The financial results for the quarter ended August 31, 2009 reflect the following pertinent information:

- The third quarter of the fiscal year contains the tail-end of the NBA basketball season and the start of the NFL football pre-season. This quarter is traditionally slow from a cash receipts basis as it contains neither the heart of the basketball nor football seasons. As well, the large cash receipts from the previous seasons' efforts have mostly been recognized as revenue by June 15. Accordingly, the accounting results for the third quarter are generally weaker than those of the other fiscal quarters. As a partial mitigant, the Company does start to receive material football season prepayments for handicapping advisory services as well as Don Best information service subscriptions that bolster cash reserves as at August 31, 2009. However, the bulk of the revenue associated with these cash inflows is only recognized in the subsequent two fiscal quarters.

- Third quarter cash flows within the Don Best division were lower than those realized in the corresponding quarter of 2008 due to the decision not to replicate the five month football season special employed in 2008 that entailed a material discount for subscribers effecting the prepayment. The cash inflow reduction will be compensated for with stronger monthly cash flows in September through January.

- The cash inflows within the Las Vegas call center that specializes in the sale of handicapping advice saw its volumes fall on a year-over-year basis as the effects of the weakening economy were brought to bear on the business. The Company continues to work to reduce its overhead within that business segment to compensate for the reduced sales volumes.

- On September 9, 2009, the Company made the first interest and principal payment owing in respect of the convertible debentures issued on April 28, 2008. Following such payment, the principal balance stands at $3.5 million to be repaid over the ensuing seven fiscal quarters. In addition, it met its monthly debt service requirements relative to the US$800,000 financing raised in April of 2009. The balance of that debt as of the date hereof is US$530,000. All debt service payments made in the third quarter or immediately thereafter have been made via the use of free cash flow from operations.

- During the third quarter of 2009, the Company did not effect any share buybacks pursuant to its normal course issuer bid.

"The third quarter of fiscal 2009 reflected both positives and negatives for BSM", stated Christopher Kape, President and CEO. "We settled the outstanding litigation related to our Don Best business which validated the legitimacy of our exclusive rights to publish the most relevant live sports odds information. Furthermore, we have made significant headway toward the development of a new technological platform for the Don Best service and the introduction of new products in 2010. Finally, we recently completed the merger of our two Las Vegas offices thereby providing significant cost savings on a go-forward basis. By contrast, we continue to realize volume declines in our handicapping advisory business and continue to look for new marketing initiatives to re-energize this business unit.

Inclusive of funds held within reserves required by the Company's payment processors, the balance sheet as at August 31, 2009 reflects aggregate cash of $1.708 million. However, $550,000 of such funds were used on September 9, 2009 to effect the requisite principal and interest payment owing in respect of the convertible debentures.

BSM is based in Vancouver, British Columbia and trades on the TSX Venture Exchange under the trading symbol "BSM". Additional information about BSM including the Company's unaudited consolidated financial statements and management discussion and analysis for the quarter ended August 31, 2009 is available under the Company's profile at www.sedar.com.

As at the date hereof BSM has 23,992,020 issued and outstanding common shares.

About Big Stick Media Corporation

BSM owns and operates a portfolio of assets that provide fact-based and opinion oriented information relevant to the sports industry. These assets include websites, client-server software, publications and call centers. BSM generates revenues in a number of ways, including various direct to consumer services and direct to business sales through a portfolio of websites, the most significant of which are www.JimFeist.com, www.donbest.com, and www.g-picks.com. BSM also operates the Don Best Sports real-time sports information systems for serious sports enthusiasts, handicappers and bettors.

Cautionary Statement

This press release may contain certain forward-looking statements with respect to the Corporation. These forward-looking statements, by their nature, involve risks and uncertainties that could cause actual results to differ materially from those contemplated. We consider the assumptions on which these forward-looking statements are based to be reasonable, but caution the reader that these assumptions regarding future events, many of which are beyond our control, may ultimately prove to be incorrect. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Big Stick Media Corporation's expectations are various risks detailed from time to time in the filings made by Big Stick Media Corporation with securities regulations.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy and accuracy of this release.

Contact Information

  • Big Stick Media Corporation
    Christopher S. Kape
    Chief Executive Officer
    (604) 630-6550 ext. 111
    chris@bigstickmedia.com