SOURCE: Idle Media, Inc.

January 14, 2011 08:43 ET

Idle Media, Inc. Announces Fiscal Year 2010 Financial Results

Revenues Increase by 128% and Net Income Increases by 234% Versus 2009

LEESPORT, PA--(Marketwire - January 14, 2011) - Idle Media, Inc. (OTCBB: IDLM) today announced its full fiscal year financial results for the period ending September 30, 2010.

  • Revenues increased by $800,559 to $1,425,523 in fiscal 2010, versus revenues of $624,964 in the 2009 fiscal year, an increase of 128.10%;

  • Net income increased from $223,805 in fiscal 2009, to $746,523 in fiscal 2010, an increase of 234%; 

  • Net profit margin during the fiscal year ended September 30, 2010 was 52%, compared to 36% in the year ago period ended September 30, 2009;

  • Total assets increased from $191,115 at the end of fiscal 2009, to $747,276 at the end of fiscal 2010, an increase of 291%;

  • Visits from October 2009 - September 2010 were 110,695,991 versus 69,231,716 from the comparable period in 2008 - 2009, an increase of 59.89%;

  • Unique visitors from October 2009 - September 2010 were 31,650,895 versus 17,275,157 from the comparable period in 2008 - 2009, an increase of 83.2%;

  • Page views from October 2009 - September 2010 were 870,041,199 versus 470,540,170 from the comparable period in 2008 - 2009, an increase of 84.9%;

  • Third party advertising revenue increased from $543,323 in fiscal year 2009, to $1,334,403 in fiscal year 2010, an increase of 146%;

  • Subscription revenue declined approximately 3% from the year ended September 30, 2009 to 2010 as the Company refocused its business model away from premium subscriptions and focused its efforts on advertising revenues.

"I am extremely pleased by our financial performance over the past year," commented Mr. Marcus Frasier, CEO of Idle Media, Inc. "Transitioning to a public company comes with many challenges, and we feel that we have met them head on. We've maintained our focus and continued to grow our business organically to strengthen our cash position and balance sheet."

Mr. Frasier added, "As we enter 2011, we will continue to focus on our core competencies, while looking to expand our business through identifying strategic partners and opportunities that are synergistic with our overall objectives for manageable growth with minimal dilution."

Fiscal year 2010 Financial Results

Revenues

Revenues for the fiscal year ending September 30, 2010 were $1,425,523 versus revenues of $624,964 in the 2009 fiscal year ending September 30, 2009, an increase of $800,559, or 128.10%.

Third party advertising revenue increased from $543,323 in fiscal year 2009, to $1,334,403 in fiscal year 2010, an increase of 146%.

Subscription revenues declined just over 3% from the year ended September 30, 2009 to 2010. We believe this is attributable to our management deciding to focus less on attracting premium subscribers and more on increasing advertising sources and revenues. Resultantly, we experienced a dramatic 146% increase in third-party advertising revenue and a 68% increase in sponsorship revenues during the year ended September 30, 2010 compared to the year ended September 30, 2009, as we added new advertising providers during the most recent fiscal year.

In the past 12 months the Company has increased its online portfolio of websites from one site to six sites, and now has mobile applications across four operating systems, including: Google® Android™; Apple® iPhone® and iTouch™; Palm Pre™ and Pixi™; and BlackBerry® 4.6+ devices.

Expenses

Overall expenses increased by 23% from the year ended September 30, 2009 to the comparable period ended September 30, 2010. A significant portion of the increase is attributable to material increases in: (1) marketing expenses, as we hosted public concerts and events in efforts to promote and generate awareness of our web properties; and (2) professional fees, primarily related to accounting and consulting fees associated with being a public reporting entity.

Merchant fees incurred as a result of processing credit/debit card transactions for subscription payments decreased $557, or 12%, year over year, primarily due to the decline in subscription revenues generated during the fiscal year ended September 30, 2010, relative to the year ended September 30, 2009.

Music scanning fees are paid to a third-party audio fingerprinting technology service that scans all music uploaded to Datpiff.com for potential copyright infringement. Audio files identified as containing copyrighted material are automatically identified and prevented from being made available on our site. The slight decrease in scanning software fees, during the year ended September 30, 2010 compared to the year ended September 30, 2009, is primarily attributable to credits received from Audible Magic for slight problems with the software we experienced.

Server costs are directly related to the hosting of our website, storage of content and archival of data, and are integral to our business. We use third-party companies specializing in hosting and data storage, which charge us based upon bandwidth and storage use. In the comparable years ended September 30, 2010 and 2009, server costs remained relatively stable, decreasing less than 1% year over year, despite our experiencing a substantive increase in web traffic over the same period.

Our management cautions that the variations in all expense categories are not accurate indications of long-term trends and ongoing expenses will continue to vary drastically from period to period.

Income Taxes and Net Income

During the year ended September 30, 2010, we realized net income of $746,523, after deducting provision for income taxes of $185,765. In the comparable year ended September 30, 2009, provision for income taxes were $0, which resulted in net income of $223,805. Year-over-year, net income increased approximately 234%, or $522,718, from the year ended September 30, 2009 to September 30, 2010. Our net profit margin during the year ended September 30, 2010 was 52%, compared to 36% in the year ago period ended September 30, 2009.

Liquidity and Capital Resources

As of September 30, 2010, we had $381,494 of cash on hand compared to a September 30, 2009 balance of $70,694 of cash on hand. This increase in cash was generated organically, primarily through operating activities. During the year ended September 30, 2010, we generated cash from operating activities of $797,038, compared to generating cash from operating activities of $149,389 in the year ended September 30, 2009.

Cash utilized in investing activities was $325,517 for the year ended September 30, 2010 compared to no cash used during the same period in 2009. Cash used was due primarily to loans made to a related party entity (majority shareholder of Idle Media, Inc. and entity owned and controlled by an officer and director of Idle Media, Inc.) to cover various operational expenditures of the entity in the amount of $222,045. We also utilized cash for software development and software purchases during the year ended September 30, 2010, necessary for the pursuit of our business objectives and growth strategy.

Cash used by financing activities was $160,721 for the year ended September 30, 2010 compared to cash used of $78,695 in 2009. The reduction in retained earnings of $166,824 during the year ended September 30, 2010 and $78,695 in the year ended September 30, 2009 is attributable primarily to distributions made to Idle Media, LLC (a majority shareholder of the Company and an entity owned and controlled by an officer and director of Idle Media, Inc.), which was the sole equity member of DatPiff, LLC prior to the acquisition by us of DatPiff, LLC.

Management's Growth Strategy

Management continues to focus on the following initiatives to expand operations over the next fiscal year:

  • Pursue Strategic Partnerships;

  • Host Additional Live Concert Series Events;

  • Remain Innovative by Investing in New Services and Technologies;

  • Continue to expand through acquisitions of strategic technologies or properties.

For more information on the Company's financial results, please view the second quarter 2010 filing at: http://www.sec.gov

About Idle Media, Inc.

Idle Media, Inc. is a publicly traded new media technology company that delivers cutting-edge content and online gaming through its wholly-owned operating companies, including Dat Piff (www.datpiff.com), a leading provider of online mix tapes and user-generated content.

Learn more about Idle Media, Inc. at: http://www.idlemedia.com. Follow Idle Media on Facebook and Twitter.

Information in this press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Without limiting the foregoing, the words "believes," "anticipates," "plans," "expects" and similar expressions are intended to identify forward-looking statements. The forward-looking statements may include our future operations, financial condition and prospects and business strategies. These forward-looking statements are subject to certain risks and uncertainties that could cause our actual results to differ materially. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this press release or in other documents including those filed with the SEC. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

Contact Information

  • Contact:
    Investor Relations
    Email Contact
    Mark Moline
    760-208-1894