Score Media Inc.
TSX : SCR

Score Media Inc.

January 13, 2011 07:01 ET

Score Media Reports Strong Q1 Growth Across All Platforms

TORONTO, ONTARIO--(Marketwire - Jan. 13, 2011) - Score Media Inc. (TSX:SCR) today announced its financial results for the first quarter ended November 30, 2010:

  • Revenue for the quarter ended November 30, 2010 increased by $0.5 million or 4% to $11.9 million compared to $11.4 million in the quarter ended November 30, 2009

  • Excluding the impact of the $0.8 million CRTC Part II fee reversal in the comparative period in fiscal 2010, EBITDA for the quarter ended November 30, 2010 increased by $0.1 million or 5% to $2.6 million, from $2.5 million in the quarter ended November 30, 2009.

"Our business continues to evolve quarter after quarter and this quarter is no exception," says John Levy, Chairman & CEO, Score Media Inc. "Our growth in both revenue and EBITDA gives us continued confidence in our business and product roadmap and leaves us well positioned to deliver on exciting new offerings planned for this coming year."

• The Company acquired 20% of NuLayer Inc. ("NuLayer"), a mobile and web development firm. The deal with NuLayer, creators of theScore iPad Edition, brings increased technology development capabilities to Score Media.

• On November 17th, the Company in partnership with Gillette announced that Brent Furtney was crowned the winner of Gillette DRAFTED 2.

• theScore announced its NBA schedule for the 2010-11 season featuring top match-ups of some of the league's most elite teams as well as comprehensive digital, radio and TV programming. In addition, Court Surfing®, theScore's NBA show, and Court Cuts, theScore's weekly highlight feature, will give hoops fans all the 2010-11 action they'll need to stay connected to everything NBA. theScore's deal with the NBA extends through the 2012/2013 season.

• On October 12ththe Company announced that Greg Wyshynski, a.k.a. "Puck Daddy", officially joined its line-up of broadcast talent. Greg Wyshynski, the editor of Puck Daddy, Yahoo! Sports' hockey blog, became a member of theScore with a live show on theScore Satellite Radio on SIRIUS Satellite Radio channel 98.

• On Day 1 at DEVCON, RIM's annual developer conference, ScoreMobile demonstrated forthcoming features and functionality that leverage the newly announced BlackBerry® Messenger (BBM™) SDK. In the months to come, ScoreMobile users will be able to directly access BBM contact lists, share news, scores and photos, and invite friends to download the app.

About Score Media Inc.

Score Media is a media company committed to delivering interactive and authentic sports entertainment. Created in 1997 in response to the growing desire for increased participation in the consumption of sports, the Company has now established itself as the home for hardcore sports fans. Score Media's primary asset, theScore Television Network ("theScore"), is a national specialty television service providing sports news, information, highlights and live event programming in more than 6.8 million homes across Canada. The Company's digital media assets include theScore.com, theScore iPad Edition and the mobile sports applications ScoreMobile and ScoreMobile FC which are available on BlackBerry, iPhone and Android devices. Score Media also operates theScore Satellite Radio which is available across North America on SIRIUS Satellite Radio Channel 98. Growing from a team of 60 in 1997 to over 270 employees in 2010, Score Media is a revolutionizing interactive media company.

Forward-looking (safe harbour) statement

Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement containing words such as "believes", "plans", "expects" or "intends" and other statements which are not historical facts contained in this release are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.

FISCAL YEAR RESULTS

The following tables reconcile net income to EBITDA:

  Three Three
  months ended months ended
  November 30, November 30,
  2010 2009
 
Net income for the period $ 839 $ 1,065
         
Add back:        
  Depreciation and amortization   999   999
  Interest expense, net   106   149
  Income tax expense   700   1,068
EBITDA $ 2,644 $ 3,281
         
 
 
Score Media Inc.
Consolidated Balance Sheets
(in thousands of dollars)
(unaudited)
       
  November 30, 2010 August 31, 2010
 
Assets        
 
Current assets:        
  Cash and cash equivalents $ 170 $ 184
  Accounts receivable   11,401   9,828
  Prepaid expenses and deposits   1,341   1,254
  Future tax assets   455   847
    13,367   12,113
 
Fixed assets   15,239   15,193
 
Intangible assets   3,442   2,818
 
Other assets   893   -
 
Future tax assets   6,350   6,658
  $ 39,291 $ 36,782
 
Liabilities and Shareholders' Equity        
 
Current liabilities:        
  Accounts payable and accrued liabilities   7,474   6,285
         
Revolving credit facility   9,812   9,511
         
Shareholders' equity   22,005   20,986
  $ 39,291 $ 36,782
 
 
Score Media Inc.
Consolidated Statements of Operations
(in thousands of dollars, except share and per share amounts)
(unaudited)
         
    Three months ended   Three months ended
    November 30, 2010   November 30, 2009
         
         
Revenue $ 11,863 $ 11,371
         
Production and other direct expenses   4,827   4,277
Selling, general and administration   3,095   2,695
Program rights   1,297   1,118
    9,219   8,090
         
Income before undernoted   2,644   3,281
         
         
Interest expense, net   106   149
Depreciation and amortization   999   999
         
Income before income taxes   1,539   2,133
         
Future income tax expense   700   1,068
         
Net income for the period $ 839 $ 1,065
         
Income per share - basic and diluted $ 0.01 $ 0.01
         
Weighted average number of Class A Subordinate Voting and Special Voting Shares outstanding        
      Basic   81,505,332   81,152,056
      Diluted   83,152,274   81,156,781
   
   
Score Media Inc.  
Consolidated Statements of Cash Flows  
(in thousands of dollars)  
(unaudited)  
         
  Three months ended   Three months ended  
  November 30, 2010   November 30, 2009  
   
Cash provided by (used in):            
   
Operations:            
  Net income for the period $ 839   $ 1,065  
  Items not involving cash:            
    Depreciation and amortization   999     999  
    Stock-based compensation expense   70     177  
    Future income tax expense   700     1,068  
             
  Change in non-cash operating working capital:            
    Accounts receivable   (1,573 )   (2,542 )
    Prepaid expenses and deposits   (87 )   (327 )
    Accounts payable and accrued liabilities   534     1,123  
    1,482     1,563  
   
Financing:            
  Draws from credit facility   12,706     8,881  
  Repayments to credit facility   (12,405 )   (9,304 )
  Issuance of Class A subordinate voting shares   110     4  
    411     (419 )
Investing:            
  Additions to fixed assets   (772 )   (476 )
  Change in non-cash working capital related to fixed assets   655     (233 )
  Acquisition of intangible assets   (897 )   (312 )
  Acquisition of interest in NuLayer   (893 )   -  
    (1,907 )   (1,021 )
   
Increase (decrease) in cash and cash equivalents   (14 )   123  
   
Cash and cash equivalents, beginning of period   184     276  
             
Cash and cash equivalents, end of period $ 170   $ 399  
   
   
Supplemental Cash Flow information            
  Interest paid $ 83   $ 91  

The following selected quarterly financial data of the Corporation relates to the eight quarters ended November 30, 2010.

          Income (loss) per  
      Net income   share – basic and  
Quarterly Results Revenue EBITDA (loss)   diluted  
  ($000's) ($000's) ($000's)   ($)  
November 30, 2010 11,863 2,644 839   0.01  
August 31, 2010 10,523 1,442 1,100   0.01  
May 31, 2010 11,986 1,916 568   0.01  
February 28, 2010 9,958 980 (239 ) 0.00  
November 30, 2009 11,371 3,281 1,065   0.01  
August 31, 2009 8,909 677 (676 ) (0.01 )
May 31, 2009 10,816 1,654 12   0.00  
February 28, 2009 8,662 204 (1,017 ) (0.01 )

The Company's revenues have historically reflected a seasonality trend, with the third quarter (ending May 31st) being the strongest, followed by the first quarter (ending November 30th), the fourth quarter (ending August 31st), and finally the second quarter (ending February 28th). This seasonality reflects general trends for sports media advertising, which in turn reflects the schedules (particularly the playoffs) of the major sports leagues.

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