Dolphin Entertainment Q2 Revenue Increases 66% Year over Year and 20% Sequentially to a Record $8.6 Million
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Dolphin Entertainment Q2 Revenue Increases 66% Year over Year and 20% Sequentially to a Record $8.6 Million

Monday, August 16, 2021 4:01 PM
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Earnings
Dolphin Entertainment

Positive Operating Income Even Including Non-Cash Depreciation & Amortization Expense

Net Income of $1.3M Equals $0.17 Basic Earnings Per Share

Completes Growth to Positive Working Capital With Surplus of $1.26M

NFTs, Dolphin's First of Dolphin 2.0 Initiatives, Have Launched

MIAMI, FL / ACCESSWIRE / August 16, 2021 / Dolphin Entertainment, Inc. (NASDAQ:DLPN), a leading entertainment marketing and premium content production company, announces its financial results for the second quarter ended June 30, 2021.

"Three major financial milestones were achieved this quarter," stated Bill O'Dowd, CEO of Dolphin Entertainment. "First, revenues of $8.6M, which topped by 20% the previous record of only one quarter prior. Secondly, positive operating income for the first time as a NASDAQ company when including the non-cash expense of depreciation and amortization. Operating income is the P&L metric we use to gauge ourselves, so this was very meaningful to us. And, third, a working capital surplus for the first time in Dolphin's history as a public company, achieved in 3 ½ years after uplisting to NASDAQ and despite pursuing an acquisition strategy to assemble a Super Group of six best-in-class marketing companies."

"All together, these 3 milestones show that we are a financially-sound, profitable and growing company," continued O'Dowd. "That is a great platform from which to accelerate our first year of Dolphin 2.0 initiatives, and make investments in opportunities we see to own content, live events, and consumer products that we already know we can market as well as anyone else."

Recent Highlights

  • Total Q2 revenue increased to $8.6 million, compared to $5.2 million in Q2 2020;
  • Operating income for the quarter ended June 30, 2021 of $56,293 including non-cash expense from depreciation and amortization of $478,270 as compared to an operating loss of $179,038, which included non-cash expense from depreciation and amortization of $496,461, for the same period in the prior year.
  • Cash and cash equivalents of $9.3 million as of June 30, 2021, compared to $7.9 million as of December 31, 2020, not including restricted cash.
  • Net Income for the quarter ended June 30, 2021 of $1.3 million, included the benefit of a net $1.0 million in non-cash items stemming from a $1.0 million gain on extinguishment of debt and a positive change in fair value of derivative liabilities, warrants, put rights and contingent consideration of $498,974, partially offset by depreciation and amortization of $478,270, compared to a net loss of $2.9 million, which included non-cash items from depreciation and amortization of $ 496,461, and a negative change in fair value of derivative liabilities, warrants, put rights and contingent consideration items in the amount of $1.7 million, for the same period in the prior year.
  • Dolphin Entertainment and FTX announced a partnership to create NFT marketplace programs for major sports and entertainment brands
  • Dolphin was added to the Russell Microcap® Index
  • The Door welcomed Häagen-Dazs and Holle to its roster of clients
  • 42West was involved in various capacities with 13 films that earned a total of 32 Academy Award nominations and won six Oscars.
  • Shore Fire clients Carole King and Todd Rundgren were inducted into the Rock & Roll Hall of Fame.
  • Dolphin Entertainment's NFTs Division entered its 1st vertical, Sports, with First NFT Partnership with Hall of Fame Resort & Entertainment; Announced Heisman Trophy Winners and Pro Football Hall of Fame Inductees Tim Brown, Earl Campbell and Doak Walker To Kick-Off NFT Collection
  • Dolphin Entertainment's NFTs Division entered its 2nd vertical, Culinary, with NFT collectible recipe card system, launching with top chefs throughout the United States; Partnered for NFT collection with world renowned artist Romero Britto, in celebration of the 20th anniversary of South Beach Wine & Food Festival.

Conference Call Information
To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.
Date, Time: August 16, 2021, at 4:30 pm ET
Toll-Free: 844-407-9500
International: 862-298-0850 Webcast: https://www.webcaster4.com/Webcast/Page/2225/42377

Conference Call Replay Information
Toll-Free: 877-481-4010
Reference ID: 42377
Webcast replay: https://www.webcaster4.com/Webcast/Page/2225/42377

About Dolphin Entertainment, Inc.

Dolphin Entertainment (NASDAQ: DLPN) is a leading independent entertainment marketing and premium content development company. Through our subsidiaries 42West, The Door and Shore Fire Media, we provide expert strategic marketing and publicity services to many of the top brands, both individual and corporate, in the film, television, music, gaming and hospitality industries. Viewpoint Creative and Be Social complement their efforts with full-service creative branding and production capabilities as well as social media and influencer marketing services. Dolphin's legacy content production business, founded by Emmy-nominated CEO Bill O'Dowd, has produced multiple feature films and award-winning digital series. Dolphin's Non-Fungible Tokens (NFTs) Division is dedicated to designing, producing, distributing and promoting NFTs for itself and its clients within the film, television, music, gaming, culinary and technology industries. The NFTs division is comprised of executives across all six of Dolphin's wholly-owned subsidiaries blending their creative expertise in creative services, digital design, production, marketing, sales and public relations. To learn more, visit:https://www.dolphinentertainment.com

This press release contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, Dolphin Entertainment Inc.'s offering of common stock as well as expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by the use of words such as "will," "would," "anticipate," "expect," "believe," "designed," "plan," or "intend," the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, Dolphin Entertainment's actual results may differ materially from the results discussed in its forward-looking statements. Dolphin Entertainment's forward-looking statements contained herein speak only as of the date of this press release. Factors or events Dolphin Entertainment cannot predict, including those described in the risk factors contained in its filings with the Securities and Exchange Commission, may cause its actual results to differ from those expressed in forward-looking statements. Although Dolphin Entertainment believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved, and Dolphin Entertainment undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

CONTACT:

James Carbonara
Hayden IR
(646)-755-7412
[email protected]

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(unaudited)

       
ASSETS
 As of June 30, 2021  As of December 31, 2020 
Current assets:
 
 
  
 
 
Cash and cash equivalents
 9,252,228  7,923,280 
Restricted cash
  677,354   714,096 
Accounts receivable, net of allowance for doubtful accounts of $563,782 and $653,272, respectively.
  5,423,507   5,027,101 
Other current assets
  424,158   231,890 
Total current assets
  15,777,247   13,896,367 
Capitalized production costs, net
  346,968   271,139 
Right-of-use assets
  7,091,493   7,106,279 
Goodwill
  20,015,800   19,627,856 
Intangible assets, net of accumulated amortization of $6,537,937 and $5,747,941, respectively.
  6,932,063   7,452,059 
Property, equipment and leasehold improvements, net
  602,297   800,071 
Deposits and other assets
  228,313   198,180 
Total Assets
 50,994,181  49,351,951 
LIABILITIES
        
Current liabilities:
        
Accounts payable
 859,912  1,190,184 
Term loan
  700,227   900,292 
Notes payable, current portion
  302,455   846,749 
Convertible notes payable at fair value, current portion
  -   580,000 
Paycheck Protection Program loans, current portion
  848,987   582,438 
Loan from related party
  -   1,107,873 
Accrued interest - related party
  1,718,227   1,783,121 
Accrued compensation
  2,625,000   2,625,000 
Put rights
  -   1,544,029 
Lease liability
  1,847,117   1,791,773 
Contract liability
  3,175,917   1,855,209 
Other current liabilities
  2,442,421   2,045,842 
Total current liabilities
  14,520,263   16,852,510 
Noncurrent liabilities:
        
Notes payable
  924,141   426,645 
Convertible notes payable
  3,050,000   1,445,000 
Convertible notes payable at fair value
  1,029,766   947,293 
Paycheck Protection Program loans
  1,188,582   2,517,431 
Contingent consideration
  730,000   530,000 
Loan from related party
  1,107,873   - 
Lease liability
  5,920,896   5,964,275 
Warrants liability
  150,000   450,000 
Other noncurrent liabilities
  200,000   550,000 
Total noncurrent liabilities
  14,301,258   12,830,644 
Total Liabilities
  28,821,521   29,683,154 

 
        
Commitments and contingencies (Note 16)
        
STOCKHOLDERS' EQUITY
        
Common stock, $0.015 par value, 40,000,000 shares authorized,7,638,469 and 6,618,785, respectively, issued and outstanding at June 30, 2021 and December 31, 2020
  114,575   99,281 
Preferred Stock, Series C, $0.001 par value, 50,000 authorized, issued and outstanding at June 30, 2021 and December 31, 2020
  1,000   1,000 
Additional paid in capital
  123,951,169   117,540,557 
Accumulated deficit
  (101,894,084)  (97,972,041)
Total Stockholders' Equity
 22,172,660  19,668,797 
Total Liabilities and Stockholders' Equity
 50,994,181  49,351,951 
         

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations

       

 
 For the three months ended  For the six months ended 

 
 June 30,  June 30, 

 
 2021  2020  2021  2020 

 
 
 
  
 
  
 
  
 
 
Revenues:
 
 
  
 
  
 
  
 
 
Entertainment publicity and marketing
 8,643,244  5,194,725  15,820,361  11,828,525 
Content production
  -   -   -   - 
Total revenues
  8,643,244   5,194,725   15,820,361   11,828,525 

 
                
Operating expenses:
                
Direct costs
  833,511   656,849   1,583,931   1,285,361 
Payroll and benefits
  5,622,468   2,879,073   10,892,831   7,779,939 
Selling, general and administrative
  1,194,704   978,527   2,718,658   2,223,345 
Depreciation and amortization
  478,270   496,461   960,982   1,017,464 
Legal and professional
  457,998   362,853   802,606   572,314 
Total expenses
  8,586,951   5,373,763   16,959,008   12,878,423 
Income (loss) before other expenses
  56,293   (179,038)  (1,138,647)  (1,049,898)

 
                
Other income (expenses):
                
Gain on extinguishment of debt, net
  1,012,973   -   955,610   3,259,866 
Loss on disposal of fixed assets
  (48,461)  -   (48,461)  - 
Loss on deconsolidation of Max Steel VIE
  -   -   -   (1,484,591)
Change in fair value of convertible notes and derivative liabilities
  268,974   (696,420)  (602,475)  (548,961)
Change in fair value of warrants
  65,000   (483,519)  (2,497,877)  (411,004)
Change in fair value of put rights
  -   47,070   (71,106)  1,517,810 
Change in fair value of contingent consideration
  165,000   (573,000)  (200,000)  (470,000)
Acquisition costs
  -       (22,907)  - 
Interest expense and debt amortization
  (169,837)  (1,058,694)  (335,031)  (1,682,976)
Total other income (expense), net
  1,293,649   (2,764,563)  (2,822,247)  180,144 
Income (loss) before income taxes
 1,349,942  (2,943,601) (3,960,894) (869,754)
Income tax benefit
  -       38,851   - 
Net income (loss)
 1,349,942  (2,943,601) (3,922,043) (869,754)

 
                
Earnings (loss) per share:
                
Basic
 0.17  (0.62) (0.53) (0.20)
Diluted
 0.13  (0.62) (0.53) (0.46)

 
                
Weighted average number of shares outstanding
                
Basic
  7,664,000   4,719,241   7,456,360   4,363,742 
Diluted
  7,913,396   5,059,867   7,456,360   (5,214,355)
                 

SOURCE: Dolphin Entertainment, Inc.

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