SOURCE: Tix Corporation

Tix Corporation

March 12, 2014 09:00 ET

Tix Corporation Reports Fourth Quarter and Full Year 2013 Results

STUDIO CITY, CA--(Marketwired - Mar 12, 2014) - Tix Corporation (the "Company") (OTCQX: TIXC), a leading provider of discount ticketing services, today reported results for the fourth quarter and full year ended December 31, 2013.

Tix Corporation's business is operated by its wholly owned subsidiary Tix4Tonight, which sells discount show tickets from eleven locations in Las Vegas. Tix4Tonight obtains its inventory of discount tickets under short-term exclusive and non-exclusive agreements with nearly every Las Vegas show along with numerous attractions and tours. The majority of our discount ticket locations also offer discount dinner reservations at various restaurants surrounding the Las Vegas strip and downtown.

Fourth Quarter 2013 and 2012

Fourth quarter 2013 revenues increased 1% to $6.0 million compared with $5.9 million for the same period a year ago. The increase in revenues was caused by the opening of two new discount ticket locations; one in July 2013 and another in August 2013.

Fourth quarter 2013 direct operating expenses, which includes payroll costs, rents, and utilities, were $2.5 million compared with $2.5 million for the same period a year ago.

Fourth quarter 2013 selling, general and administrative expenses were $2.9 million compared with $2.4 million for the same period a year ago. Included in these expenses are $740,000 of expenses during the fourth quarter of 2013 and $270,000 of expenses during the same period a year ago, in each case relating to expenses for certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expenses. Excluding these expenses, selling, general and administrative expenses increased $69,000, or 3%, to $2.2 million compared to $2.1 million for the same period a year ago.

Fourth quarter 2013 net income was $109,000, or $0.00 per diluted common share, as compared to a net income of $807,000, or $0.03 per diluted common share reported for the same period a year ago. Adjusted Earnings (as defined and explained below) for the fourth quarter 2013 and for the same period a year ago, which include adjustments for items such as expenses for certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expense described below, were $1.5 million, or $0.06 per diluted common share.

Full Year 2013 and 2012

For the full year of 2013, revenues decreased 9% to $22.2 million compared with $24.3 million for the same period a year ago. The decline in revenues of $2.2 million was caused by large scale construction and renovation projects on the Las Vegas Strip requiring us to close two of our discount ticket locations; one in April 2012 and another in February 2013. This decline in revenues was partially offset by the opening of two new discount ticket locations; one in July 2013 and another in August 2013.

For the full year of 2013, direct operating expenses decreased 10% to $9.4 million compared with $10.4 million for the same period a year ago. The decrease in expenses of $1.0 million was due to $298,000 in reduced rents and utilities expense and $382,000 in reduced payroll costs realized in connection with the changes in discount ticket locations during the period as discussed above, and $338,000 in reduced rents at one of our discount ticket locations that took effect on August 1, 2012.

For the full year of 2013, selling, general and administrative expenses were $9.8 million compared with $10.8 million for the same period a year ago. Included in these expenses are $1.7 million of expenses during the full year of 2013 and $2.3 million of expenses during the same period a year ago, in each case relating to expenses for certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expenses. Excluding these expenses, selling, general and administrative expenses decreased $405,000, or 5%, to $8.1 million compared to $8.5 million for the same period of the prior year. The decrease in expenses of $405,000 was realized in connection with the changes in discount ticket locations during the period as discussed above and our continual efforts to manage our overall expenses.

For the full year of 2013, net income was $1.6 million, or $0.07 per diluted common share, as compared to a net income of $1.4 million, or $0.06 per diluted common share, reported for the same period a year ago. Adjusted Earnings (as defined and explained below) for the full year of 2013, which include adjustments for items such as discontinued operations and expenses for certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expenses described below, were $5.7 million, or $0.24 per diluted common share, as compared to Adjusted Earnings of $6.5 million, or $0.27 per diluted common share, reported for the same period a year ago.

Conclusion 

Mitch Francis, Chief Executive Officer of the Company, stated, "We are excited to get past the majority of the recent short-term disruptions in our marketplace caused by large scale construction and renovation projects in Las Vegas. With no outstanding litigation and our return to positive revenue growth in the fourth quarter of 2013, I believe we should be well positioned heading into 2014."

Investor Conference Call

The Company does not host a conference call following its earnings release. Investors are encouraged to contact the Company's investor relations officer, Steve Handy, CFO, at (818) 761-1002 with any questions.

Non-GAAP Financial Measure

Included in this press release is a "non-GAAP financial measure," which is a measure of the Company's historical or future performance that is different from measures calculated and presented in accordance with GAAP but that the Company believes is useful to investors. The Company defines Adjusted Earnings as net income plus (a) loss on discontinued operations, (b) other expense, net, (c) income taxes, (d) depreciation and amortization charges, (e) stock based compensation expense, (f) loss on disposition of property and equipment, (g) unusual litigation, and (h) expenses for certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters. The Company believes that Adjusted Earnings is a useful measure of the Company's operating performance because a significant portion of its assets consists of goodwill and intangible assets and property and equipment that are amortized and depreciated as non-cash items over their remaining useful lives in accordance with GAAP. The Company's presentation of Adjusted Earnings may help investors assess the Company's performance before the effect of various items that do not directly affect the Company's ongoing operating performance. The Company also believes that measures similar to the Company's measurement of Adjusted Earnings are widely used in similar entertainment companies to measure operating performance, although Adjusted Earnings as calculated by the Company is not necessarily comparable to similarly titled measures by such other companies. Adjusted Earnings (a) does not represent net income or cash flows from operations as defined by GAAP, (b) is not necessarily indicative of cash available to fund the Company's cash flow needs, and (c) should not be considered as an alternative to net income, operating income, cash flows from operating activities or the Company's other financial information as determined under GAAP.

About Tix Corporation

Tix Corporation (OTCQX: TIXC) provides discount ticketing services. It currently operates eleven discount ticket stores in Las Vegas under its Tix4Tonight marquee, which offers up to a 50 percent discount for same-day shows, concerts, attractions and sporting events, as well as discount reservations for dining.

Safe Harbor Statement

Except for the historical information contained herein, certain matters discussed in this press release are forward-looking statements which involve risks and uncertainties. Forward-looking statements include, but are not limited to, statements about the expected operations and sales at each of the two new discount ticket locations discussed herein, potential improvements in consumer spending in Las Vegas, and our future revenues and financial position. These forward-looking statements are based on expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties which could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are discussed in the Company's various historical filings with the Securities and Exchange Commission and, since November 2010, the Company's filings with the OTCQX. The Company assumes no obligation to update these forward-looking statements. A copy of the Company's reports for the twelve months ended December 31, 2013 can be found on the Company website at www.tixcorp.com or at www.otcqx.com.

   
TIX CORPORATION AND SUBSIDIARY  
CONSOLIDATED BALANCE SHEETS  
   
    December 31, 2013     December 31, 2012  
Assets  
Current assets:                
  Cash   $ 3,176,000     $ 6,017,000  
  Short-term investments     -       2,993,000  
  Accounts receivable     63,000       45,000  
  Prepaid expenses and other current assets     268,000       419,000  
    Total current assets     3,507,000       9,474,000  
                 
Property and equipment, net     884,000       1,047,000  
                 
Other assets:                
  Intangible assets:                
    Goodwill     3,120,000       3,120,000  
    Intangibles, net     498,000       1,006,000  
    Total intangible assets     3,618,000       4,126,000  
  Deposits and other assets     71,000       187,000  
    Total other assets     3,689,000       4,313,000  
      Total assets   $ 8,080,000     $ 14,834,000  
                 
Liabilities and Stockholders' Equity  
Current liabilities:                
  Accounts payable - shows and events   $ 693,000     $ 2,435,000  
  Accounts payable and accrued expenses     939,000       937,000  
  Deferred revenue     29,000       151,000  
  Notes payable - short term and net of discount     3,726,000       -  
  Obligation for share purchases - short term     84,000       209,000  
    Total current liabilities     5,471,000       3,732,000  
                 
Deferred rent obligations     133,000       156,000  
Note payable - net of current portion and discount     728,000       879,000  
Obligation for share purchases - net of current portion     160,000       244,000  
Total liabilities     6,492,000       5,011,000  
                 
Commitments and contingencies                
                 
Stockholders' equity:                
  Preferred stock, $.01 par value; 500,000 shares authorized; none issued                
  Common Stock, $.08 par value; 100,000,000 shares authorized; 18,218,572 shares net of 15,406,803 treasury shares, and 23,669,831 shares net of 9,955,544 treasury shares issued and outstanding at December 31, 2013 and December 31, 2012, respectively     2,691,000       2,691,000  
  Additional paid-in capital     93,356,000       92,366,000  
  Obligation for share purchases     (2,088,000 )     (2,032,000 )
  Cost of shares held in treasury     (25,413,000 )     (14,654,000 )
  Accumulated deficit     (66,958,000 )     (68,532,000 )
  Accumulated other comprehensive loss     -       (16,000 )
    Total stockholders' equity     1,588,000       9,823,000  
      Total liabilities and stockholders' equity   $ 8,080,000     $ 14,834,000  
                       
                       
                       
TIX CORPORATION AND SUBSIDIARY  
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME  
             
    Three Months Ended December 31,  
    2013     2012  
                 
Revenues   $ 5,952,000     $ 5,902,000  
Operating expenses:                
  Direct costs of revenues     2,484,000       2,498,000  
  Selling, general and administrative expenses     2,922,000       2,383,000  
  Loss on disposition of property and equipment     171,000       -  
  Depreciation and amortization     303,000       275,000  
    Total costs and expenses     5,880,000       5,156,000  
Operating income     72,000       746,000  
Other expense:                
  Other expense     (69,000 )     (1,000 )
  Interest income     3,000       6,000  
  Interest expense     (13,000 )     (25,000 )
    Other expense, net     (79,000 )     (20,000 )
Income (loss) from operations before income tax expense     (7,000 )     726,000  
Income tax benefit     (116,000 )     (81,000 )
Net income   $ 109,000     $ 807,000  
  Unrealized loss on available-for-sale securities     -       (3,000 )
Comprehensive income   $ 109,000     $ 804,000  
Net income per common share                
  Net income per common share - basic   $ 0.00     $ 0.03  
  Net income per common share - basic and diluted   $ 0.00     $ 0.03  
                 
Weighted average common shares outstanding - basic     23,250,503       23,669,831  
Weighted average common shares outstanding - diluted     23,398,632       23,802,712  
                 
                 
                 
TIX CORPORATION AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME  
             
    Years Ended December 31,  
    2013     2012  
                 
Revenues   $ 22,154,000     $ 24,325,000  
Operating expenses:                
  Direct costs of revenues     9,365,000       10,383,000  
  Selling, general and administrative expenses     9,790,000       10,773,000  
  Loss on disposition of property and equipment     171,000       -  
  Depreciation and amortization     1,141,000       1,147,000  
    Total costs and expenses     20,467,000       22,303,000  
Operating income     1,687,000       2,022,000  
Other expense:                
  Other expense     (69,000 )     -  
  Interest income     16,000       29,000  
  Interest expense     (55,000 )     (103,000 )
    Other expense, net     (108,000 )     (74,000 )
Income from continuing operations before income tax expense     1,579,000       1,948,000  
Income tax expense     5,000       29,000  
Income from continuing operations     1,574,000       1,919,000  
Discontinued operations:                
  Loss from operations of discontinued operations     -       (300,000 )
  Loss on sale of discontinued operations     -       (244,000 )
Loss on discontinued operations     -       (544,000 )
Net income   $ 1,574,000     $ 1,375,000  
  Unrealized gain (loss) on available-for-sale securities     16,000       (16,000 )
Comprehensive income   $ 1,590,000     $ 1,359,000  
                 
Net income per common share - continuing operations                
  Net income per common share - continuing operations - basic   $ 0.07     $ 0.08  
  Net income per common share - continuing operations - diluted   $ 0.07     $ 0.08  
                 
Net loss per common share - discontinued operations                
  Net loss per common share - discontinued operations - basic   $ -     $ (0.02 )
  Net loss per common share - discontinued operations - diluted   $ -     $ (0.02 )
                 
Net income per common share                
  Net income per common share - basic   $ 0.07     $ 0.06  
  Net income per common share - basic and diluted   $ 0.07     $ 0.06  
                 
Weighted average common shares outstanding - basic     23,565,286       23,670,505  
Weighted average common shares outstanding - diluted     23,641,083       24,374,724  
                 
                 
                 
TIX CORPORATION AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF CASH FLOWS  
   
    Years Ended December 31,  
    2013     2012  
Cash flows from operating activities:                
  Net income   $ 1,574,000     $ 1,375,000  
    Adjustments to reconcile net income to cash provided by operating activities:                
    Loss on discontinued operations     -       544,000  
    Depreciation     633,000       633,000  
    Non-cash interest     32,000       82,000  
    Realized loss on sale of short-term investments     24,000       6,000  
    Amortization of intangible assets     508,000       514,000  
    Loss on disposition of property and equipment     171,000       -  
    Fair value of options and warrants issued to employees and directors     937,000       997,000  
    (Increase) decrease in:                
      Accounts receivable     (18,000 )     10,000  
      Prepaid expenses and other assets     267,000       344,000  
    Increase (decrease) in:                
      Accounts payable - shows and events     (1,742,000 )     343,000  
      Accounts payable and accrued expenses     2,000       (257,000 )
      Deferred revenue     (122,000 )     40,000  
      Deferred rent obligations     (23,000 )     23,000  
        Net cash provided by operating activities from continuing operations     2,243,000       4,654,000  
        Net cash provided by operating activities from discontinued operations     -       15,000  
        Net cash provided by operating activities     2,243,000       4,669,000  
Cash flows from investing activities:                
  Purchases of property and equipment     (641,000 )     (281,000 )
  Purchases of short-term investments     (1,199,000 )     (4,195,000 )
  Maturity of short-term investments     4,184,000       1,186,000  
        Net cash provided by (used in) investing activities     2,344,000       (3,290,000 )
Cash flows from financing activities:                
  Cost of treasury shares, net of fees     (7,216,000 )     (23,000 )
  Payment of repurchase obligation     -       (2,360,000 )
  Repayment of acquisition note     -       (625,000 )
  Obligation for share purchases     (212,000 )     (431,000 )
        Net cash used in financing activities     (7,428,000 )     (3,439,000 )
  Net decrease     (2,841,000 )     (2,060,000 )
  Balance at beginning of period     6,017,000       8,077,000  
  Balance at end of period   $ 3,176,000     $ 6,017,000  
                 
                 
                 
TIX CORPORATION AND SUBSIDIARIES  
TIX RECONCILIATION OF NET INCOME TO ADJUSTED EARNINGS  
(UNAUDITED)  
   
The following table set forth a reconciliation of consolidated net income to consolidated Adjusted Earnings:  
   
    Three months ended     Three months ended  
    December 31, 2013     December 31, 2012  
                 
Net income   $ 109,000     $ 807,000  
Income tax benefit     (116,000 )     (81,000 )
Other expense, net     79,000       20,000  
Depreciation and amortization     303,000       275,000  
Stock based compensation expense     187,000       232,000  
Loss on disposition of property and equipment     171,000       -  
Litigation expense and non-routine legal and advisory services for corporate and governance matters     740,000       270,000  
Adjusted Earnings   $ 1,473,000     $ 1,523,000  
                 
                 
                 
    Twelve months ended     Twelve months ended  
    December 31, 2013     December 31, 2012  
                 
Net income   $ 1,574,000     $ 1,375,000  
Loss from discontinued operations     -       544,000  
Income tax expense     5,000       29,000  
Other expense, net     108,000       74,000  
Depreciation and amortization     1,141,000       1,147,000  
Stock based compensation expense     937,000       997,000  
Loss on disposition of property and equipment     171,000       -  
Litigation expense and non-routine legal and advisory services for corporate and governance matters     1,736,000       2,314,000  
Adjusted Earnings   $ 5,672,000     $ 6,480,000  
                 

Contact Information

  • Contact:
    Steve Handy
    CFO
    818-761-1002