Attached files
| file | filename |
|---|---|
| 8-K - SouthPeak Interactive CORP | v174835_8k.htm |
| EX-99.2 - SouthPeak Interactive CORP | v174835_ex99-2.htm |
News
Release
SouthPeak
Interactive Corporation Reports Fiscal 2010 Second Quarter Financial
Results
Company
Reports Net Revenues of $10.1 Million, 29% Decrease in Operating Expenses and
Cash Flow Positive
QuarterSouthPeak
to Host Conference Call Today at 8:00 AM Eastern Time
MIDLOTHIAN,
Va., Feb 17, 2010 (BUSINESS WIRE) -- SouthPeak Interactive Corporation (OTC
Bulletin Board: SOPK), one of the world's leading video game publishers, today
announced financial results for the fiscal 2010 second quarter ended December
31, 2009.
Second
Quarter Fiscal 2010 Financial Highlights
|
•
|
Net
revenues of $10.1 million, compared with $17.3 million in the comparable
period in fiscal 2009;
|
|
•
|
Total
operating expenses decreased by 29% to $5.3 million, compared with $7.5
million in the second quarter of fiscal
2009;
|
|
•
|
GAAP
net loss was ($2.6) million, or ($0.06) per share, compared with a GAAP
net income of $1.2 million, or $0.02 per diluted share in the comparable
period in fiscal 2009;
|
|
•
|
Non-GAAP1
net income was $433,000, or $0.01 per diluted share, compared with
a non-GAAP net income of $1.7 million, or $0.05 per diluted share, in the
same three month period in fiscal
2009;
|
|
•
|
Adjusted
EBITDA2
was $1.4 million, compared with an adjusted EBITDA of $2.9 million
in the prior fiscal year period;
and,
|
|
•
|
Positive
cash flow from operations of $7,000, compared with a cash flow deficit of
($6.8) million for the fiscal 2009 second
quarter.
|
Second
Quarter Fiscal 2010 and Recent Business Highlights
|
•
|
Entered
mobile marketplace with the launch of Schrodinger's Rat for the iPhone(TM)
and iPod(TM) touch;
|
|
•
|
Secured
strategic partnership agreement with Koch Media's Deep Silver to
exclusively distribute Deep Silver's games in North
America;
|
|
•
|
Released
two titles during the quarter: Horrid Henry (Wii, Nintendo DS and PC) and
My Baby First Steps(TM) (Wii(TM) and Nintendo DS(TM)) to leverage key My
Baby franchise;
|
|
•
|
Increased
My Baby franchise unit sales by 45% compared with the fiscal 2009 holiday
season.
|
|
•
|
Introduced
new titles since January: Blood Bowl(R) (Windows PC and Xbox 360), Fast
Food Panic (Nintendo DS, Wii); and, Crime Scene (Nintendo DS), Hotel Giant
2 (Windows PC); and,
|
|
•
|
Upcoming
product releases include: Prison Break (Xbox 360 and PS3), Risen (Xbox
360), Miniclip(TM) Sushi Go Round (Wii, Nintendo DSi(TM) and iPhone(TM)),
TNA iMPACT: Cross the Line (PSP, PSPgo and Nintendo DS), Dementium(TM) 2
(Nintendo DS), 3Dot
Heroes (PS3(TM)), and Battle vs. Chess (Xbox 360, PS3 and Windows
PC).
|
"Given
the challenging and crowded retail market that continues to operate under
unprecedented inventory controls, we shipped only two new titles as a strategic
decision to release those games that we knew would succeed during the peak
fourth calendar quarter selling season," said Melanie Mroz, CEO of SouthPeak.
"We believe this defensive posturing has allowed us to fare relatively well
against strong industry headwinds as we continue to execute on our proven
business strategy. Among our shipments was My Baby First Steps, to further
capitalize on our popular series. Our My Baby franchise continues to be among
our top sellers and was a clear standout in the holiday season. Unit sales from
this franchise have increased 45% compared with last holiday season when we
introduced the first title in this series.
"From an
operational standpoint, we also made significant expense reduction gains and
generated positive operating cash flow. During the quarter, we reduced our
operating expenses by 32% year-over-year based largely on a $3.3 million gain on
the settlement of trades payables, which was primarily related to the
termination of a distribution and co-publishing agreement, and a 44% reduction
in sales and marketing due to lower spending based on our decision to release
fewer titles in the period in order to best align our cost structure with our
anticipated revenue stream," Mroz concluded.
Terry
Phillips, Chairman of SouthPeak, added, "Our unique business model allows us to
leverage our relationships with independent developers to optimize our
risk-return profile and substantially control costs. We are seeing an increasing
market shift of larger publishers focusing on their owned and branded games,
which offers SouthPeak increasing access to new titles at nominal fees from
emerging developers. Partnerships such as our recent Deep Silver agreement also
provide us with access to exciting new titles to capture additional revenue
streams and enhance our global brand. Under this agreement we plan to release
popular titles such as Prison Break for the Xbox 360 and PS3, and Risen for Xbox
360 in March. To further diversify our offering, later this year we plan to
enter the social gaming sector, where we see a significant opportunity to grow
our business through new and relevant titles introductions for this growing
platform.
"We are
confident that this strategy will continue to serve us well and lend SouthPeak a
considerable advantage as we work to introduce new titles and improve our sales
to stay ahead of industry trends. We believe we can gain additional traction
with our existing game titles, as well as introduce new games that broaden our
exciting portfolio," Phillips concluded.
Second
Quarter Fiscal 2010 Financial Summary
For the
second quarter ended December 31, 2009, SouthPeak reported net revenues of $10.1
million, compared with $17.3 million in the second quarter ended December 31,
2008. The decrease in revenues was primarily due to a decrease in the number of
titles released in the fiscal 2010 period. Titles released in the fiscal 2009
period also included games for the Xbox 360 and PS3, which sell at a higher
MSRP, whereas the new releases in the fiscal 2010 period only included Nintendo
DS and Wii product, which sell at a lower MSRP.
For the
three months ended December 31, 2009 gross profit decreased to $3.2 million, or
32% of revenues, from $8.8 million, or 51% of revenues, in the 2008. The
decrease in gross profit was due primarily to selling fewer units for next
generation platforms, which have a higher MSRP, in the three months ended
December 31, 2009 versus the prior period.
Total
operating expenses for the second quarter of fiscal 2010 decreased by 29% to
$5.3 million, compared with $7.5 million in the second quarter of fiscal 2009.
The decrease in operating expenses for the fiscal 2010 period, was due primarily
to a $3.3 million gain in the settlement of trade payables resulting from the
termination of a distribution agreement, as well as a 44% reduction in sales and
marketing expense to $2.2 million, compared with $4.0 million in the comparable
prior year period. The reduction in sales and marketing costs was due to lower
direct spending as a result of releasing fewer titles. Improvements to operating
expenses were partially offset by $3.1 million in litigation costs associated
with legal fees and a UK judgment associated with SouthPeak's legal proceedings
with CDV Software Entertainment A.G.
GAAP net
loss for the second quarter of fiscal 2010 was ($2.6) million, or ($0.06) per
share based on 45.0 million weighted average shares outstanding, compared with
GAAP net income of $1.2 million, or $0.02 per diluted share, based on 53.2
million weighted average shares outstanding in the second quarter of fiscal
2009.
Non-GAAP
net income for the three months ended December 31, 2009 was $433,000, or $0.01
per diluted share, compared with non-GAAP net income of $1.7 million, or $0.05
per diluted share for the three months ended December 31, 2008.
Adjusted
EBITDA for the second quarter of fiscal 2010 was $1.4 million, compared with
adjusted EBITDA of $2.9 million in the prior fiscal year period.
The
Company's latest financials have been prepared on a going concern basis as
indicated in the company's 10-Q filing with the SEC on February 16, 2010. The
quarterly report for the period ended December 31, 2009 includes a going
concern from SouthPeak's independent auditor, which contemplates the realization
of assets and satisfaction of liabilities in the normal course of business. The
ability of the Company to continue as a going concern is predicated upon, among
other things, continuing to generate positive cash flows from operations, curing
the default on the production advance payable, renewing its line of credit with
SunTrust Banks, Inc. ("SunTrust") and/or obtaining alternative or additional
financing, and the resolution of various contingencies. SouthPeak is currently
in the process of renewing its line of credit with SunTrust, as well as
attempting to expeditiously resolve its contingencies for amounts significantly
less than currently accrued for in order to reduce its aggregate liabilities on
its balance sheet and actively controlling its cost structure to better align
with its revenue stream. While the Company is committed to pursuing these
options and others to address its viability as a going concern, there can be no
assurance that these plans will be successfully completed; and therefore, there
is uncertainty about the Company's ability to realize its assets or satisfy its
liabilities in the normal course of business
Conference
Call
SouthPeak
will hold an investment community conference call to discuss its financial
results for the period, its latest game sales and prospects today, Wednesday,
February 17, 2010, at 8:00 a.m. Eastern time.
To
participate in the conference call, please dial (877) 407-8033 in the United
States, or (201) 689-8033 internationally. Investors may also access a live
audio webcast of the conference call on the events page of the Company's
investor relations website at http://investor.southpeakgames.com/phoenix.zhtml?c=198218&p=irol-calendar.
A replay
of the webcast will be available approximately two hours after the conclusion of
the live call and will remain available for one year following the live event.
An audio replay will be available beginning approximately one hour after the
conclusion of the call and will be made available until February 23, 2010. The
audio replay can be accessed by dialing (877) 660-6853 or (201) 612-7415. When
prompted, enter account number: 286 followed by access ID number
344422.
Use
of Non-GAAP Financial Information
To
supplement SouthPeak's consolidated condensed financial statements presented on
a GAAP basis, SouthPeak also presents certain non-GAAP measures including
non-GAAP net income (loss) and adjusted EBITDA information in this press
release. The company presents the following non-GAAP measures of results:
operating income and earnings per share. Each is adjusted to exclude special
items.
The
company's management believes these non-GAAP measures provide investors,
potential investors, securities analysts and others with useful information to
evaluate the performance of the business, because they exclude losses that
management believes are not indicative of the ongoing operating results of the
business. In addition, these non-GAAP measures are used by management to
evaluate the operating performance of the company. The presentation of this
additional information is not meant to be considered in isolation or as a
substitute for operating income or earnings per share as determined in
accordance with GAAP.
The
Company uses adjusted EBITDA as a measure of the Company's operating trends.
Adjusted EBITDA is a non-GAAP measurement that the Company uses as a metric to
provide information about SouthPeak's operating trends. SouthPeak defines
adjusted EBITDA as earnings before interest, taxes, depreciation and
amortization.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
|
Three
Months Ended
December
31,
|
||||||||
|
2009
|
2008
|
|||||||
|
Operating
income
|
$ | (2,133,408 | ) | $ | 1,266,600 | |||
|
Add:
loss attributed to CDV litigation
|
3,075,206 | - | ||||||
|
Add:
restructuring expenses
|
- | 560,806 | ||||||
|
Operating
income exclusive of special items
|
$ | 941,798 | $ | 1,827,406 | ||||
|
Net
income (loss)
|
$ | (2,642,266 | ) | $ | 1,166,545 | |||
|
Add:
loss attributed to CDV litigation
|
3,075,206 | - | ||||||
|
Add:
restructuring expenses
|
- | 560,806 | ||||||
|
Net
income exclusive of special items
|
$ | 432,940 | $ | 1,727,351 | ||||
|
Earnings
(loss) per share
|
(0.06 | ) | $ | 0.03 | ||||
|
Add:
loss attributed to CDV litigation
|
0.07 | - | ||||||
|
Add:
restructuring expenses
|
- | 0.02 | ||||||
|
Earnings
per share exclusive of special items
|
$ | 0.01 | $ | 0.05 | ||||
|
Net
Income
|
$ | (2,642,266 | ) | $ | 1,166,546 | |||
|
Depr
& Amort
|
65,095 | 121,567 | ||||||
|
Amort
intellectual property
|
99,551 | 67,517 | ||||||
|
Income
taxes
|
- | - | ||||||
|
Interest
|
508,858 | 100,055 | ||||||
|
EBITDA
|
$ | (1,968,762 | ) | $ | 1,455,685 | |||
|
Restructuring
costs
|
- | 560,806 | ||||||
|
Transaction
costs in P&L
|
- | 10,295 | ||||||
|
Noncash
stock compensation
|
308,224 | 178,142 | ||||||
|
Registration
statement penalty
|
- | 111,000 | ||||||
|
Bad
debt expense
|
- | 534,312 | ||||||
|
Reserve
adjustments:
|
||||||||
|
Loss
reserved for CDV Litigation
|
3,075,206 | - | ||||||
|
Adjusted
EBITDA
|
$ | 1,414,668 | $ | 2,850,240 | ||||
About
SouthPeak Interactive Corporation
SouthPeak
Interactive Corporation develops and publishes interactive entertainment
software for all current hardware platforms including: PlayStation(R)3 computer
entertainment system, PSP(R) (PlayStation(R)Portable) system, PlayStation(R)2
computer entertainment system, PSP(R)go system, Xbox 360(R) videogame and
entertainment system, Wii(TM), Nintendo DS(TM), Nintendo DSi(TM) and PC.
SouthPeak's games cover all major genres including action/adventure, role
playing, racing, puzzle strategy, fighting and combat. SouthPeak's products are
sold in retail outlets in North America, Europe, Australia and Asia. SouthPeak
is headquartered in Midlothian, Virginia, and has offices in Grapevine, Texas
and Leicester, England.
SouthPeak's
extensive portfolio of over 50 interactive entertainment games spans a variety
of platforms and genres including RPG, simulation, FPS, sports, strategy, puzzle
and fighting.
For
additional information, please visit SouthPeak's corporate website: http://www.southpeakgames.com.
If you
would like to be added to SouthPeak's email list to receive news directly,
please send your request to southpeak@tpg-ir.com.
Forward-Looking
Statements
This
release contains "forward-looking" statements that are made pursuant to the Safe
Harbor provisions of the Private Securities Litigation Reform Act of 1995. These
are statements that are predictive in nature, that depend upon or refer to
future events or conditions, or that include words such as "may," "will,"
"expects," "projects," "anticipates," "estimates," "believes," "intends,"
"plans," "should," "seeks," and similar expressions. This press release contains
forward-looking statements relating to, among other things, SouthPeak's
expectations and assumptions concerning future financial performance.
Forward-looking statements involve known and unknown risks and uncertainties
that may cause actual future results to differ materially from those projected
or contemplated in the forward-looking statements. Forward-looking statements
may be significantly impacted by certain risks and uncertainties described in
SouthPeak's filings with the Securities and Exchange Commission.
The risks
and uncertainties referred to above include, but are not limited to, risks
associated with SouthPeak's potential inability to compete with larger
businesses in its industry, the limitations of SouthPeak's business model,
SouthPeak's potential inability to anticipate and adapt to changing technology,
the possibility that SouthPeak may not be able to enter into publishing
arrangements with some developers, SouthPeak's dependence on vendors to meet its
commitments to suppliers, SouthPeak's dependence on hardware manufactures to
publish new videogames, SouthPeak's potential inability to recuperate the
up-front license fees paid to console manufacturers, SouthPeak's dependence on a
limited number of customers, SouthPeak's potential dependence on the success of
a few videogames, SouthPeak's dependence on developers to deliver their
videogames on time, the potential of litigation, interference with SouthPeak's
business from the adoption of governmental regulations; and the inability to
obtain additional financing to grow its business.
SOUTHPEAK
INTERACTIVE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Net
revenues
|
$
|
10,063,952
|
$
|
17,308,874
|
$
|
26,773,601
|
$
|
25,696,577
|
||||||||
|
Cost
of goods sold:
|
||||||||||||||||
|
Product
costs
|
5,149,597
|
6,939,774
|
8,696,283
|
12,365,327
|
||||||||||||
|
Royalties
|
1,618,962
|
1,492,259
|
6,619,633
|
2,301,180
|
||||||||||||
|
Intellectual
property licenses
|
99,797
|
67,517
|
219,457
|
111,497
|
||||||||||||
|
Total
cost of goods sold
|
6,868,356
|
8,499,550
|
15,535,373
|
14,778,004
|
||||||||||||
|
Gross
profit
|
3,195,596
|
8,809,324
|
11,238,228
|
10,918,573
|
||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Warehousing
and distribution
|
320,723
|
268,980
|
607,234
|
476,563
|
||||||||||||
|
Sales
and marketing
|
2,215,620
|
3,954,803
|
5,870,676
|
5,950,539
|
||||||||||||
|
General
and administrative
|
2,973,944
|
2,747,840
|
6,088,712
|
4,128,265
|
||||||||||||
|
Restructuring
costs
|
-
|
560,806
|
-
|
560,806
|
||||||||||||
|
Transaction
costs
|
-
|
10,295
|
-
|
28,675
|
||||||||||||
|
Litigation
costs
|
3,075,206
|
-
|
3,075,206
|
-
|
||||||||||||
|
Gain
on settlement of trade payables
|
(3,256,489)
|
|
-
|
(3,256,489)
|
|
-
|
||||||||||
|
Total
operating expenses
|
5,329,004
|
7,542,724
|
12,385,339
|
11,144,848
|
||||||||||||
|
(Loss)
income from operations
|
(2,133,408)
|
|
1,266,600
|
(1,147,111)
|
|
(226,275)
|
|
|||||||||
|
Interest
expense, net
|
508,858
|
100,055
|
808,174
|
158,934
|
||||||||||||
|
Net
(loss) income
|
(2,642,266)
|
|
1,166,545
|
(1,955,285)
|
|
(385,209)
|
|
|||||||||
|
Deemed
dividend related to beneficial conversion feature on Series A convertible
preferred stock
|
-
|
-
|
-
|
1,142,439
|
||||||||||||
|
Net
(loss) income attributable to common shareholders
|
$
|
(2,642,266)
|
|
$
|
1,166,545
|
$
|
(1,955,285)
|
|
$
|
(1,527,648)
|
|
|||||
|
Basic
income (loss) per share:
|
$
|
(0.06)
|
|
$
|
0.03
|
$
|
(0.04)
|
|
$
|
(0.04)
|
|
|||||
|
Diluted
income (loss) per share:
|
$
|
(0.06)
|
|
$
|
0.02
|
$
|
(0.04)
|
|
$
|
(0.04)
|
|
|||||
|
Weighted
average number of common shares outstanding - Basic
|
45,039,292
|
35,920,100
|
44,930,125
|
35,920,100
|
||||||||||||
|
Weighted
average number of common shares outstanding - Diluted
|
45,039,292
|
53,188,686
|
44,930,125
|
35,920,100
|
||||||||||||
SOUTHPEAK
INTERACTIVE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
|
December
31,
|
June
30,
|
|||||
|
2009
|
2009
|
|||||
|
(Unaudited)
|
||||||
|
Assets
|
||||||
|
Current
assets:
|
||||||
|
Cash
and cash equivalents
|
$
|
658,609
|
$
|
648,311
|
||
|
Restricted
cash
|
849,600
|
1,245,582
|
||||
|
Accounts
receivable, net of allowances of $6,648,613 and $7,214,984 at December 31,
2009 and June 30, 2009, respectively
|
7,327,750
|
4,972,417
|
||||
|
Inventories
|
3,710,148
|
4,459,837
|
||||
|
Current
portion of advances on royalties
|
6,867,061
|
8,435,415
|
||||
|
Current
portion of intellectual property licenses
|
383,571
|
410,995
|
||||
|
Related
party receivables
|
60,842
|
33,207
|
||||
|
Prepaid
expenses and other current assets
|
530,449
|
573,145
|
||||
|
Total
current assets
|
20,388,030
|
20,778,909
|
||||
|
Property
and equipment, net
|
2,778,721
|
2,754,139
|
||||
|
Advances
on royalties, net of current portion
|
1,551,869
|
1,556,820
|
||||
|
Intellectual
property licenses, net of current portion
|
1,726,071
|
1,917,858
|
||||
|
Goodwill
|
8,031,766
|
7,490,065
|
||||
|
Intangible
assets, net
|
23,692
|
43,810
|
||||
|
Other
assets
|
11,600
|
11,872
|
||||
|
Total
assets
|
$
|
34,511,749
|
$
|
34,553,473
|
||
|
Liabilities
and Shareholders' Equity
|
||||||
|
Current
liabilities:
|
||||||
|
Line
of credit
|
$
|
5,310,732
|
$
|
5,349,953
|
||
|
Current
maturities of long-term debt
|
63,649
|
50,855
|
||||
|
Production
advance payable in default
|
3,755,104
|
-
|
||||
|
Accounts
payable
|
12,056,142
|
19,686,168
|
||||
|
Accrued
royalties
|
1,693,805
|
414,696
|
||||
|
Accrued
expenses and other current liabilities
|
5,004,449
|
2,419,100
|
||||
|
Accrued
litigation costs
|
4,308,035
|
-
|
||||
|
Deferred
revenues
|
295,301
|
2,842,640
|
||||
|
Due
to shareholders
|
-
|
232,440
|
||||
|
Due
to related parties
|
4,400
|
125,045
|
||||
|
Accrued
expenses - related parties
|
137,288
|
184,766
|
||||
|
Total
current liabilities
|
32,628,905
|
31,305,663
|
||||
|
Long-term
debt, net of current maturities
|
1,574,608
|
1,538,956
|
||||
|
Total
liabilities
|
34,203,513
|
32,844,619
|
||||
|
Shareholders'
equity:
|
||||||
|
Series
A convertible preferred stock, $0.0001 par value; 15,000,000 shares
authorized; 5,653,833 and 5,953,833 shares issued and outstanding at
December 31, 2009 and June 30, 2009, respectively; aggregate liquidation
preference of $5,653,833 at December 31, 2009
|
565
|
595
|
||||
|
Common
stock, $0.0001 par value; 90,000,000 shares authorized; 45,106,600 and
44,530,100 shares issued and outstanding at December 31, 2009 and June 30,
2009, respectively
|
4,511
|
4,453
|
||||
|
Additional
paid-in capital
|
25,675,318
|
25,210,926
|
||||
|
Accumulated
deficit
|
(25,101,085)
|
|
(23,145,800)
|
|||
|
Accumulated
other comprehensive loss
|
(271,073)
|
|
(361,320)
|
|||
|
Total
shareholders' equity
|
308,236
|
1,708,854
|
||||
|
Total
liabilities and shareholders' equity
|
$
|
34,511,749
|
$
|
34,553,473
|
||
SOUTHPEAK
INTERACTIVE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS
|
For
the six months ended
|
||||||||
|
December
31,
|
||||||||
|
2009
|
2008
|
|||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
loss
|
$
|
(1,955,285)
|
|
$
|
(385,209)
|
|
||
|
Adjustments
to reconcile net loss to net cash provided by (used in) operating
activities:
|
||||||||
|
Depreciation
and amortization
|
129,972
|
164,909
|
||||||
|
Allowances
for price protection, returns, and defective merchandise
|
(531,050)
|
|
3,542,272
|
|||||
|
Bad
debt expense, net of recoveries
|
(35,321)
|
|
538,622
|
|||||
|
Stock-based
compensation expense
|
359,920
|
342,505
|
||||||
|
Common
stock and warrants issued to vendor
|
104,500
|
-
|
||||||
|
Amortization
of royalties and intellectual property licenses
|
5,443,825
|
1,844,853
|
||||||
|
Loss
on disposal of fixed assets
|
4,839
|
-
|
||||||
|
Gain
on settlement of trade payables
|
(3,256,489)
|
|
-
|
|||||
|
Changes
in operating assets and liabilities:
|
||||||||
|
Accounts
receivable
|
(1,788,962)
|
|
(2,079,345)
|
|
||||
|
Inventories
|
749,689
|
1,559,586
|
||||||
|
Advances
on royalties
|
(3,651,309)
|
|
(5,604,552)
|
|||||
|
Intellectual
property licenses
|
-
|
(915,000)
|
|
|||||
|
Related
party receivables
|
(27,635)
|
|
24,673
|
|||||
|
Prepaid
expenses and other current assets
|
42,696
|
(40,518)
|
|
|||||
|
Other
assets
|
-
|
(5,017)
|
|
|||||
|
Production
advance payable
|
3,755,104
|
-
|
||||||
|
Accounts
payable
|
(4,318,114)
|
|
(5,188,640)
|
|
||||
|
Accrued
royalties
|
1,279,109
|
(363,324)
|
|
|||||
|
Accrued
expenses and other current liabilities
|
1,988,225
|
618,998
|
||||||
|
Accrued
litigation costs
|
4,308,035
|
-
|
||||||
|
Deferred
revenues
|
(2,547,339)
|
|
(872,886)
|
|
||||
|
Accrued
expenses - related parties
|
(47,478)
|
(4,182)
|
|
|||||
|
Total
adjustments
|
1,962,217
|
(6,437,046)
|
|
|||||
|
Net
cash provided by (used in) operating activities
|
6,932
|
(6,822,255)
|
|
|||||
|
Cash
flows from investing activities:
|
||||||||
|
Purchases
of property and equipment
|
(65,544)
|
|
(219,666)
|
|
||||
|
Cash
payments to effect acquisition, net of cash acquired
|
-
|
(247,542)
|
|
|||||
|
Change
in restricted cash
|
395,982
|
(1,904)
|
|
|||||
|
Net
cash provided by (used in) investing activities
|
330,438
|
(469,112)
|
|
|||||
|
Cash
flows from financing activities:
|
||||||||
|
Proceeds
from line of credit
|
16,557,571
|
16,825,346
|
||||||
|
Repayments
of line of credit
|
(16,596,792)
|
|
(14,254,607)
|
|
||||
|
Repayments
of long-term debt
|
(25,013)
|
|
(12,211)
|
|
||||
|
Net
proceeds from (repayments of) amounts due to shareholders
|
(232,440)
|
|
(228,998)
|
|
||||
|
Net
proceeds from (repayments of) amounts due to related
parties
|
(120,645)
|
|
10,111
|
|||||
|
Proceeds
from the issuance of Series A convertible preferred stock, net of cash
offering costs
|
-
|
1,250,281
|
||||||
|
Net
cash (used in) provided by financing activities
|
(417,319)
|
|
3,589,922
|
|||||
|
Effect
of exchange rate changes on cash and cash equivalents
|
90,247
|
(180,944)
|
|
|||||
|
Net
increase (decrease) in cash and cash equivalents
|
10,298
|
(3,882,389)
|
|
|||||
|
Cash
and cash equivalents at beginning of the period
|
648,311
|
4,095,036
|
||||||
|
Cash
and cash equivalents at end of the period
|
$
|
658,609
|
$
|
212,647
|
||||
|
Supplemental
cash flow information:
|
||||||||
|
Cash
paid during the period for interest
|
$
|
243,011
|
$
|
157,744
|
||||
|
Cash
paid during the period for taxes
|
$
|
-
|
$
|
-
|
||||
|
Supplemental
disclosure of non-cash activities:
|
||||||||
|
Intellectual
property licenses included in accrued expenses and other current
liabilities
|
$
|
-
|
$
|
135,000
|
||||
|
Contingent
purchase price payment obligation related to Gamecock
acquisition
|
$
|
597,124
|
$
|
421,956
|
||||
|
Decrease
in goodwill with respect to finalizing purchase price
allocation
|
$
|
55,423
|
$
|
-
|
||||
|
Purchase
of vehicle through the assumption of a note payable
|
$
|
73,459
|
$
|
-
|
||||
1 Non-GAAP net income measures exclude
special items. Please refer to the table at the end of this release titled
"Non-GAAP Reconciliation" for reconciliation between GAAP and non-GAAP financial
measures.
2 Adjusted
EBITDA is a non-GAAP measurement that the Company uses as a metric to provide
information about SouthPeak's operating trends. SouthPeak defines adjusted
EBITDA as earnings before interest, taxes, depreciation and amortization.
SOURCE:
SouthPeak Interactive Corporation
SouthPeak
Interactive Corporation
Investors:
Kristen
McNally or Brandi Floberg, 212-481-2050
southpeak@tpg-ir.com