SOURCE: Tix Corporation

Tix Corporation

March 31, 2015 16:01 ET

Tix Corporation Reports Fourth Quarter and Full Year 2014 Results

STUDIO CITY, CA--(Marketwired - Mar 31, 2015) - Tix Corporation (the "Company") (OTCQX: TIXC)

FULL YEAR 2014 HIGHLIGHTS

  • Net income for 2014 increased 164% to a record $4.1 million
  • Earnings per share for 2014 increased 229% to a record $0.23 per share
  • Net cash provided by operating activities for 2014 increased 173% to $6.1 million
  • Working capital for 2014 increased 233% to $2.6 million
  • Debt reduced by $3.7 million
  • Federal Net Operating Losses (NOL) of $4.7 million were utilized in 2014 leaving a balance of $37.6 million

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, 2014. 

Tix Corporation's business is operated by its wholly owned subsidiary Tix4Tonight, which sells discount show tickets from ten 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. Our discount ticket locations also offer discount dinner reservations at various restaurants surrounding the Las Vegas strip and downtown.

Fourth Quarter 2014 and 2013

Fourth quarter 2014 revenues were $5.9 million, comparable with the same period a year ago. The Company operated one less location compared to the same period a year ago. 

Fourth quarter 2014 direct operating expenses, which includes payroll costs, rents, and utilities, were $2.4 million compared with $2.5 million for the same period a year ago. Direct operating expenses, as a percentage of revenues, were 41% and 42% for the fourth quarter 2014 and 2013, respectively. The Company recorded a direct operating expense of $176,000 in the fourth quarter 2014 representing its remaining lease obligation on a recently closed location, less anticipated future sublease receipts. 

Fourth quarter 2014 selling, general and administrative expenses were $2.4 million compared with $2.9 million for the same period a year ago. Included in the same period a year ago are $740,000 of 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 $251,000, or 12%, to $2.4 million compared to $2.2 million for the same period a year ago. The increase in expenses was primarily related to compensation expense. 

Fourth quarter 2014 net income was $888,000, or $0.05 per diluted common share, as compared to a net income of $109,000, or $0.00 per diluted common share reported for the same period a year ago. Adjusted Earnings (as defined and explained below) for the fourth quarter 2014, which include adjustments for items such as certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expenses described below, were $1.2 million, or $0.07 per diluted common share, as compared to Adjusted Earnings of $1.5 million, or $0.06 per diluted common share, reported for the same period a year ago.

Full Year 2014 and 2013

For the full year of 2014, revenues increased 2% to $22.7 million compared with $22.2 million for the prior year. The increase in revenues of $542,000 is attributed to the increased locations in operation as compared to the prior year. 

For the full year of 2014, direct operating expenses were $9.4 million compared with $9.4 million for the prior year. Direct operating expenses, as a percentage of revenues, were 42% for both full year 2014 and 2013.

For the full year of 2014, selling, general and administrative expenses were $7.9 million compared with $9.8 million for the prior year. Included in these expenses are $109,000 of expenses during the full year of 2014 and $1.7 million of expenses during the prior year, 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 $220,000, or 3%, to $7.8 million compared to $8.1 million for the prior year. The decrease in expenses of $220,000 was realized from a reduction in stock based compensation expense offset by increased compensation expense, increased fees associated with our senior secured promissory note and increased professional services fees. These increases were offset by a reduction in expenses over our remaining operating accounts. 

For the full year of 2014, net income was $4.1 million, or $0.23 per diluted common share, as compared to a net income of $1.6 million, or $0.07 per diluted common share, reported for prior year. Adjusted Earnings (as defined and explained below) for the full year of 2014, which include adjustments for items such as certain non-recurring matters requiring legal and advisory services relating to corporate and governance matters and litigation expenses described below, were $5.9 million, or $0.32 per diluted common share, as compared to Adjusted Earnings of $5.7 million, or $0.24 per diluted common share, reported for the prior year.

Conclusion 

Mitch Francis, Chief Executive Officer of the Company, stated, "We are pleased with our performance in 2014. We returned to revenue growth, significantly reduced our legal costs, and reported record net income and earnings per share. I'm encouraged about 2015 and hopeful we will build on our recent performance." 

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) other expense, net, (b) income taxes, (c) depreciation and amortization charges, (d) stock based compensation expense, (e) loss on disposition of property and equipment, (f) unusual litigation, and (g) 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 ten 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 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 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, 2014 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, 2014     December 31, 2013  
Assets                
Current assets:                
  Cash   $ 4,866,000     $ 3,176,000  
  Accounts receivable     54,000       63,000  
  Prepaid expenses and other current assets     148,000       268,000  
    Total current assets     5,068,000       3,507,000  
                 
Property and equipment, net     918,000       884,000  
                 
Other assets:                
  Intangible assets:                
    Goodwill     3,120,000       3,120,000  
    Intangibles, net     153,000       498,000  
    Total intangible assets     3,273,000       3,618,000  
  Deposits and other assets     68,000       71,000  
    Total other assets     3,341,000       3,689,000  
      Total assets   $ 9,327,000     $ 8,080,000  
                 
Liabilities and Stockholders' Equity                
Current liabilities:                
  Accounts payable - shows and events   $ 938,000     $ 693,000  
  Accounts payable and accrued expenses     1,236,000       939,000  
  Deferred revenue     25,000       29,000  
  Notes payable - short term and net of discount     176,000       3,726,000  
  Obligation for share purchases - short term     81,000       84,000  
    Total current liabilities     2,456,000       5,471,000  
                 
Deferred rent obligations     133,000       133,000  
Note payable - net of current portion and discount     552,000       728,000  
Obligation for share purchases - net of current portion     78,000       160,000  
Total liabilities     3,219,000       6,492,000  
                 
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; 17,864,744 shares net of 15,451,803 treasury shares, and 18,218,572 shares net of 15,406,803 treasury shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively     2,666,000       2,691,000  
  Additional paid-in capital     93,865,000       93,356,000  
  Obligation for share purchases     (2,148,000 )     (2,088,000 )
  Cost of shares held in treasury     (25,465,000 )     (25,413,000 )
  Accumulated deficit     (62,810,000 )     (66,958,000 )
    Total stockholders' equity     6,108,000       1,588,000  
      Total liabilities and stockholders' equity   $ 9,327,000     $ 8,080,000  
   
   
TIX CORPORATION AND SUBSIDIARY  
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME  
             
    Three Months Ended December 31,  
    2014     2013  
                 
Revenues   $ 5,942,000     $ 5,952,000  
Operating expenses:                
  Direct costs of revenues     2,439,000       2,484,000  
  Selling, general and administrative expenses     2,433,000       2,922,000  
  Loss on disposition of property and equipment     -       171,000  
  Depreciation and amortization     194,000       303,000  
    Total costs and expenses     5,066,000       5,880,000  
Operating income     876,000       72,000  
Other expense:                
  Other expense     -       (69,000 )
  Interest income     -       3,000  
  Interest expense     (8,000 )     (13,000 )
    Other expense, net     (8,000 )     (79,000 )
Income (loss) from operations before income tax expense     868,000       (7,000 )
Income tax benefit     (20,000 )     (116,000 )
Net income   $ 888,000     $ 109,000  
Net income per common share                
  Net income per common share - basic   $ 0.05     $ 0.00  
  Net income per common share - basic and diluted   $ 0.05     $ 0.00  
                 
Weighted average common shares outstanding - basic     18,176,337       23,250,503  
Weighted average common shares outstanding - diluted     18,558,582       23,398,632  
   
   
TIX CORPORATION AND SUBSIDIARY  
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME  
             
    Years Ended December 31,  
    2014     2013  
                 
Revenues   $ 22,696,000     $ 22,154,000  
Operating expenses:                
  Direct costs of revenues     9,441,000       9,365,000  
  Selling, general and administrative expenses     7,943,000       9,790,000  
  Loss on disposition of property and equipment     -       171,000  
  Depreciation and amortization     855,000       1,141,000  
    Total costs and expenses     18,239,000       20,467,000  
Operating income     4,457,000       1,687,000  
Other expense:                
  Other income (expense)     3,000       (69,000 )
  Interest income     1,000       16,000  
  Interest expense     (213,000 )     (55,000 )
    Other expense, net     (209,000 )     (108,000 )
Income before income tax expense     4,248,000       1,579,000  
Income tax expense     100,000       5,000  
Net income   $ 4,148,000     $ 1,574,000  
  Unrealized gain on available-for-sale securities     -       16,000  
Comprehensive income   $ 4,148,000     $ 1,590,000  
                 
Net income per common share                
  Net income per common share - basic   $ 0.23     $ 0.07  
  Net income per common share - basic and diluted   $ 0.23     $ 0.07  
                 
Weighted average common shares outstanding - basic     18,194,770       23,565,286  
Weighted average common shares outstanding - diluted     18,347,168       23,641,083  
   
   
TIX CORPORATION AND SUBSIDIARY  
CONSOLIDATED STATEMENTS OF CASH FLOWS  
   
    Years Ended December 31,  
    2014     2013  
Cash flows from operating activities:                
  Net income   $ 4,148,000     $ 1,574,000  
    Adjustments to reconcile net income to cash provided by operating activities:                
    Depreciation     510,000       633,000  
    Non-cash interest     17,000       32,000  
    Realized loss on sale of short-term investments     -       24,000  
    Amortization of intangible assets     345,000       508,000  
    Loss on disposition of property and equipment     -       171,000  
    Fair value of options and warrants issued to employees and directors     429,000       937,000  
    (Increase) decrease in:                
      Accounts receivable     9,000       (18,000 )
      Prepaid expenses and other assets     123,000       267,000  
    Increase (decrease) in:                
      Accounts payable - shows and events     245,000       (1,742,000 )
      Accounts payable and accrued expenses     297,000       2,000  
      Deferred revenue     (4,000 )     (122,000 )
      Deferred rent obligation     -       (23,000 )
        Net cash provided by operating activities     6,119,000       2,243,000  
Cash flows from investing activities:                
  Purchases of property and equipment     (544,000 )     (641,000 )
  Purchases of short-term investments     -       (1,199,000 )
  Maturity of short-term investments     -       4,184,000  
        Net cash provided by (used in) investing activities     (544,000 )     2,344,000  
Cash flows from financing activities:                
  Proceeds received from issuance of senior secured note payable     4,000,000       -  
  Payment of senior secured note payable     (4,000,000 )     -  
  Payment of notes payable     (3,743,000 )     -  
  Cost of treasury shares, net of fees     (52,000 )     (7,216,000 )
  Obligation for share purchases     (90,000 )     (212,000 )
        Net cash used in financing activities     (3,885,000 )     (7,428,000 )
  Net increase (decrease)     1,690,000       (2,841,000 )
  Balance at beginning of period     3,176,000       6,017,000  
  Balance at end of period   $ 4,866,000     $ 3,176,000  
 
 
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, 2014     December 31, 2013  
                 
Net income   $ 888,000     $ 109,000  
Income tax benefit     (20,000 )     (116,000 )
Other expense, net     8,000       79,000  
Depreciation and amortization     194,000       303,000  
Stock based compensation expense     162,000       187,000  
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  
Adjusted Earnings   $ 1,232,000     $ 1,473,000  
             
             
    Twelve months ended     Twelve months ended  
    December 31, 2014     December 31, 2013  
                 
Net income   $ 4,148,000     $ 1,574,000  
Income tax expense     100,000       5,000  
Other expense, net     209,000       108,000  
Depreciation and amortization     855,000       1,141,000  
Stock based compensation expense     429,000       937,000  
Litigation expense and non-routine legal and advisory services for corporate and governance matters     109,000       1,736,000  
Loss on disposition of property and equipment     -       171,000  
Adjusted Earnings   $ 5,850,000     $ 5,672,000  

Contact Information

  • Contact:
    Steve Handy
    CFO
    818-761-1002