Big Stick Media Corporation
TSX VENTURE : BSM

Big Stick Media Corporation

April 28, 2009 11:27 ET

Big Stick Media Corporation Announces Financial Results for the Quarter Ended February 28, 2009 & Provides Information in Its Proposed Share Consolidation

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 28, 2009) - Big Stick Media Corporation ("BSM" or the "Company") (TSX VENTURE:BSM) announces today its financial results for the quarter ended February 28, 2009.

For the quarter ended February 28, 2009, the Company realized net income of $435,096 versus net income of $233,327 for the quarter ended February 29, 2008. The net income figure includes various non-cash accounting items including amortization expense, stock option compensation expense, accredited interest expense, gains on asset dispositions and net foreign exchange losses emanating from the movement of the U.S. dollar. Excluding the effects of the non-cash items as well as the ongoing cash interest expense, the modified EBITDA for the first quarter of fiscal 2009 was $2.04 million versus $682,000 for the corresponding quarter of fiscal 2008.

The financial results for the quarter ended February 28, 2009 reflect the following pertinent information:

- The first quarter of the fiscal year coincides with the second half and completion of the football season. This quarter is traditionally very strong since subscription packages as well as packages of advisory content sold at the beginning of football season continue to be recognized as revenue during the first quarter despite the fact that related marketing and sales commission costs have been expensed in previous quarters. As such, the modified EBITDA figure typically exceeds the cash generated from operations during the course of the first quarter. This is the case in 2009, as the modified EBITDA was $2.04 million versus a cash from operations figure of $1.59 million.

- Cash flows within the Don Best division continued to show strength even after the conclusion of the lucrative football season. By contrast, 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.

- As part of the Don Best Sports acquisition, BSM became obligated to effect two separate deferred purchase price instalments each in the amount of US$2,045,000 due and payable on each of October 28, 2008 and April 28, 2009. The payment due in October of 2008 was effected in full with the application of positive cash generated from operations. On April 3, 2009, the Company announced that it would likely be in default of the obligation due on April 28, 2009. However, on April 24, 2009 the Company completed a private debt placement that raised US$800,000. These proceeds, supplemented by operating cash produced since October 28, 2008, will enable the Company to effect full payment in respect of this obligation.

- On September 12, 2008, the Company filed a notice of intention with the TSX Venture Exchange (the "Exchange") relating to the repurchase by the Company of certain of its issued and outstanding common shares pursuant to a normal course issuer bid undertaken in accordance with the rules and policies of the Exchange. The Company proposed to purchase up to 6,084,255 common shares, representing 5% of the total common shares issued and outstanding as at the date of application, during the twelve month period commencing upon receipt of the Exchange approval for such program. During the quarter ended February 28, 2009, an aggregate 637,000 shares were purchased by the Company for cancellation in conjunction with the issuer bid.

"The first quarter of fiscal 2009 was a strong one for BSM despite the challenging economic environment", stated Christopher Kape, President and CEO. "With consumers clearly feeling the effects of the downturn, we were still able to produce substantial operating cash flow while continuing to effect meaningful cost savings within our primary business units. As previously disclosed, we continue to litigate certain matters regarding our Don Best business unit. While the cost of this endeavour is not overly material, it has had an impact on our financial results. We are confident that the outcome will justify the initiative and further cement our dominance in the sports information market."

Inclusive of funds held within reserves required by the Company's payment processors, the balance sheet as at February 28, 2009 reflects aggregate cash of $3.59 million.

The Company also takes this opportunity to provide additional details with respect to its proposed consolidation of all of its common shares on a five to one (5:1) basis.

As of the date hereof, the Company has 120,060,101 issued and outstanding common shares. Subsequent to the proposed consolidation, the Company will have 24,012,020 issued and outstanding common shares.

The Company is recommending that its shareholders approve, by way of special resolution at its Special and Annual General Meeting of its shareholders which is scheduled for May 13, 2009, the consolidation because Management believes that the proposed consolidation will make the Company more attractive to the investment community and potentially facilitate future offerings of equity securities (although no such offerings are contemplated at this time).

The consolidation is also subject to the approval of the TSX Venture Exchange. The Company will not have its name changed in connection with the proposed consolidation.

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 February 28, 2009 are available under the Company's profile at www.sedar.com.

As at the date hereof BSM has 120,060,101 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