Big Stick Media Corporation
TSX VENTURE : BSM

Big Stick Media Corporation

October 08, 2008 15:20 ET

Big Stick Media Corporation Announces Earnings for Fiscal Quarter Ended August 31, 2008

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 8, 2008) - Big Stick Media Corporation ("BSM" or the "Company") (TSX VENTURE:BSM) today announces its financial results for its third fiscal quarter of 2008 (ended August 31, 2008).

During the third quarter of its 2008 fiscal year, the Company achieved total revenue of $2,920,000 and incurred a net loss of $1,067,000. The corresponding revenue and net loss figures for the third quarter of fiscal 2007 were $1,586,000 and $1,335,000 respectively. Excluding the effects of (a) non-cash expenses related to amortization, stock option compensation and foreign exchange gains and losses emanating from the movement of U.S. dollar, as well as (b) interest expense produces an adjusted EBITDA figure for the quarter ended August 31, 2008 of $363,000. The corresponding figure for the third quarter of fiscal 2007 was a loss of $859,000.

The cash flow from operations for the quarter ended August 31, 2008 reflected a net use of funds of $412,000. However, this figure includes the effects of a one-time contract cancellation expense of $1,250,000 related to the termination of a marketing services contract with a third party consultant in support of the Linetracker product. With the acquisition of the Don Best Sports product line ("Don Best"), Linetracker and the related marketing services contract became redundant and were wound down. This expense had been accrued in the quarter ended May 31, 2008 but the payment was only effected in June. Excluding the effects of this non-recurring expenditure, the operations produced positive cash flow of $838,000 in the third quarter of fiscal 2008. The corresponding figure for the third quarter of fiscal 2007 was negative $117,000.

The enhanced EBITDA in the third quarter of 2008 is primarily due to the addition of the Don Best operations following their acquisition by BSM on April 28, 2008. This division produced EBITDA of approximately $635,000. Furthermore, on the strength of its significant cash inflows realized in August in respect of the sale of extended period customer subscriptions, its free cash balances grew by around $1.4 million during the quarter.

In addition to the revenues recognized to date by the Company, its balance sheet, as at August 31, 2008, reflects deferred revenue of approximately $3.98 million, 99% of which will be recognized as revenue in the ensuing 12 months. There are no material deferred costs on the balance sheet to be expensed against such revenue.

"The third quarter of 2008 represented a key turning point for BSM as we have become a cash flow positive operation," stated Christopher Kape, President and Chief Executive Officer. "We were very pleased by the performance of the Don Best business. As well, we initiated substantial overhead reduction initiatives in our Las Vegas call center operations. Despite material staffing and marketing cuts, our early football-related sales of advisory content exceeded our budget and allowed for cash accumulation in that unit. Overall, we look forward to continuing to deliver on our business plan of solidifying our position as the pre-eminent provider of fact-based and opinion-oriented information for the North American sports market."

The Company's unaudited consolidated financial statements and management discussion and analysis (MD&A) for the third quarter ended August 31, 2008 are available at www.sedar.com.

As at the date hereof and including the issued shares referred to herein, BSM has 121,495,601 issued and outstanding common shares.

BSM is based in Vancouver, British Columbia and trades on the TSX Venture Exchange under the trading symbol "BSM".

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. In addition, the Company operates various fantasy sports contests catering to all the sports enthusiasts through its fantasy sports website www.rotoplay.com.

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.

The TSX Venture Exchange has not reviewed, and does not accept responsibility for the adequacy and accuracy of this release.

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