| [x] |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES |
| [ ] |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES |
Commission File Number: 000-27105
ACME COMMUNICATIONS,
INC.
(Exact name of
registrant as specified in its charter)
| Delaware (State or other jurisdiction of incorporation or organization) |
33-0866283 (I.R.S. employer identification no.) |
2101 E. Fourth Street,
Suite 202 A
Santa Ana, California, 92705
(714) 245-9499
(Address and telephone
number of principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes [x] No [ ] |
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [x] No [ ]
As of August 6, 2004, ACME Communications, Inc. had 16,772,415 shares (including 429,115 shares held in treasury) of common stock outstanding.
ACME COMMUNICATIONS, INC.
FORM 10-Q
TABLE OF CONTENTS
| Item Number |
Page | |
|---|---|---|
| Part I-- Financial Information | ||
| Item 1. | Financial Statements | |
| Consolidated Balance Sheets as of June 30, 2004 and December 31, 2003 | 1 | |
| Consolidated Statements of Operations for the Three Months and Six Months Ended | ||
| June 30, 2004 and June 30, 2003 | 2 | |
| Consolidated Statements of Stockholders' Equity for the Six Months Ended June 30, 2004 | 3 | |
| Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2004 and | ||
| June 30, 2003 | 4 | |
| Notes to Consolidated Finanacial Statements | 5 | |
| Item 2. | Management's Discussion and Analysis of Financial Condition and Results Of Operations | 9 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 12 |
| Item 4. | Controls and Procedures | 12 |
| Part II - Other Information | ||
| Item 1. | Legal Proceedings | 13 |
| Item 2. | Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities | 13 |
| Item 4. | Submission of Matters to a vote of Security Holders | 13 |
| Item 6 | Exhibits and Reports on Form 8-K | 14 |
| ACME Communications, Inc. and Subsidiaries Consolidated Balance Sheet | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| As of | ||||||||||
| June 30, 2004 (unaudited) |
December 31 2003 | |||||||||
| (In thousands) | ||||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 1,640 | $ | 1,197 | ||||||
| Restricted cash | 37 | 1,984 | ||||||||
| Accounts receivable, net | 8,621 | 8,037 | ||||||||
| Current portion of programming rights | 9,705 | 10,561 | ||||||||
| Prepaid expenses and other current assets | 714 | 850 | ||||||||
| Total Current Assets | 20,717 | 22,629 | ||||||||
| Property and equipment, net | 30,615 | 28,774 | ||||||||
| Programming rights, net of current portion | 12,729 | 17,243 | ||||||||
| Intangible assets, net | 99,787 | 99,016 | ||||||||
| Other assets | 3,602 | 4,250 | ||||||||
| Total Assets | $ | 167,450 | $ | 171,912 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 6,506 | $ | 5,833 | ||||||
| Accrued liabilities | 4,332 | 3,281 | ||||||||
| Current portion of programming rights payable | 10,446 | 10,764 | ||||||||
| Current portion of obligations under lease | 91 | 2,048 | ||||||||
| Income taxes payable | 67 | 279 | ||||||||
| Total Current Liabilities | 21,442 | 22,205 | ||||||||
| Programming rights payable, net of current portion | 11,208 | 16,545 | ||||||||
| Obligations under lease, net of current portion | 966 | 988 | ||||||||
| Other liabilities | 84 | 79 | ||||||||
| Deferred income taxes | 8,065 | 7,500 | ||||||||
| Notes payable under revolving credit facility | 36,050 | 26,970 | ||||||||
| Total Liabilities | 77,815 | 74,287 | ||||||||
| Minority Interest | 168 |
-- | ||||||||
| Stockholders' equity: | ||||||||||
| Preferred stock, $.01 par value; 10,000,000 shares authorized, no | ||||||||||
| Shares issued and outstanding | -- | -- | ||||||||
| Common stock, $.01 par value; 50,000,000 shares authorized, | ||||||||||
| 16,772,415 and 16,767,250 shares issued and outstanding | ||||||||||
| at June 30, 2004 and December 31, 2003, respectively | 168 | 168 | ||||||||
| Additional paid-in capital | 132,038 | 131,998 | ||||||||
| Unearned compensation | (11 | ) | (34 | ) | ||||||
| Accumulated deficit | (39,745 | ) | (34,507 | ) | ||||||
| Less: Treasury stock, at cost; 429,115 shares | (2,983 | ) | -- | |||||||
| Total Stockholders' Equity | 89,467 | 97,625 | ||||||||
| Total Liabilities and Stockholders' Equity | $ | 167,450 | $ | 171,912 | ||||||
See the notes to the consolidated financial statements.
1
| ACME Communications, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited) (In thousands, except per share data) | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| For the Three Months Ended June 30, |
For the Six Months Ended June 30, | |||||||||||||
| 2004 |
2003 |
2004 |
2003 | |||||||||||
| (restated) | ||||||||||||||
| Net revenues | $ | 12,217 | $ | 11,532 | $ | 23,228 | $ | 21,524 | ||||||
| Operating expenses: | ||||||||||||||
| Cost of Service: | ||||||||||||||
| Programming, including program amortization | 4,943 | 4,655 | 9,578 | 8,793 | ||||||||||
| Other costs of service (excluding depreciation and amortization | ||||||||||||||
| of $1,284 and $1,182 for the three months ended June 30, 2004 | ||||||||||||||
| and June 30, 2003 respectively, and $2,573 and $2,158 for the | ||||||||||||||
| six months ended June 30, 2004 and June 30, 2003 respectively) | 2,019 | 1,890 | 3,752 | 3,527 | ||||||||||
| Selling, general and administrative expenses | 4,661 | 4,761 | 9,363 | 9,364 | ||||||||||
| Depreciation and amortization | 1,297 | 1,131 | 2,599 | 2,192 | ||||||||||
| Corporate expense | 946 | 972 | 1,819 | 1,939 | ||||||||||
| Operating expenses | 13,866 | 13,409 | 27,111 | 25,815 | ||||||||||
| Operating loss | (1,649 | ) | (1,877 | ) | (3,883 | ) | (4,291 | ) | ||||||
| Other income (expenses): | ||||||||||||||
| Interest income | 3 | 198 | 5 | 294 | ||||||||||
| Interest expense | (836 | ) | (2,496 | ) | (1,559 | ) | (10,880 | ) | ||||||
| Loss on early extinguishment of debt | -- | (9,926 | ) | -- | (9,926 | ) | ||||||||
| Other | (34 | ) | (3 | ) | (55 | ) | (40 | ) | ||||||
| Loss from continuing operations before income taxes and minority interest | (2,516 | ) | (14,104 | ) | (5,492 | ) | (24,843 | ) | ||||||
| Income tax expense, continuing operations | (493 | ) | (300 | ) | (1,108 | ) | (783 | ) | ||||||
| Loss from continuing operations before minority interest | (3,009 | ) | (14,404 | ) | (6,600 | ) | (25,626 | ) | ||||||
| Minority interest | 218 | -- | 457 | -- | ||||||||||
| Loss from continuing operations | (2,791 | ) | (14,404 | ) | (6,143 | ) | (25,626 | ) | ||||||
| Discontinued operations: | ||||||||||||||
| Income (loss) from discontinued operations | -- | (34 | ) | -- | 113,998 | |||||||||
| Income tax benefit (expense) | -- | 1 | -- | (907 | ) | |||||||||
| Income from discontinued operations | -- | (33 | ) | -- | 113,091 | |||||||||
| Net income (loss) | $ | (2,791 | ) | $ | (14,437 | ) | $ | (6,143 | ) | $ | 87,465 | |||
| Income (loss) per share, basic and diluted: | ||||||||||||||
| Continuing operations | $ | (0.17 | ) | $ | (0.86 | ) | $ | (0.37 | ) | $ | (1.53 | ) | ||
| Discontinued operations | -- | (0.00 | ) | -- | 6.75 | |||||||||