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| EX-99.2 - PRESS RELEASE DATED AUGUST 10, 2020 - Liberated Syndication Inc. | lsyn_ex992.htm |
| 8-K - CURRENT REPORT - Liberated Syndication Inc. | lsyn_8k.htm |
Exhibit 99.1
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For
Immediate Release
Liberated
Syndication Inc. (LSYN)
August
13, 2020
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Liberated Syndication Reports 2020 Second Quarter Financial
Results
Company to Host Conference Call at 11:00 a.m. ET on Friday, August
14, 2020
Pittsburgh, PA - - - Liberated Syndication Inc. (OTCQB:LSYN)
(“Libsyn” or “the Company”), the
industry’s leading podcast hosting platform, today announced
its financial results for the quarter ended June 30,
2020.
Quarterly Financial and Corporate Highlights
(All financial comparisons to the prior year period unless
otherwise noted)
●
Total revenues
increased 11.4% to $6.3 million, driven by growth in podcast
hosting revenue, premium subscriptions, and web-hosting services
through the Company’s wholly owned subsidiary, Pair Networks,
Inc. (“Pair Networks”)
●
Operating income
increased 121.7% to $1.9 million
●
Net income of
$275,364, or $0.01 per basic and diluted share, which included a
$1.6 million income tax expense due to a change in the deferred tax
assets, expected federal balance due for the three-month period
ended June 30, 2020, and an uncertain tax position
reserve.
●
Cash of $19.4
million as of June 30, 2020, compared to $16.6 million as of
December 31, 2019 and $17.9 million at March 31, 2020
●
Company
subsequently announced conclusion of its strategic review process,
noting that pursuing organic growth opportunities creates the most
advantageous path to enhancing shareholder value
Operating Highlights
●
Number of podcasts
on Libsyn’s platform grew to 74,000 during the second quarter
of 2020
●
Commissioned Edison
Research study in May 2020 to identify opportunities in podcasting
across Spanish-language listeners
●
Apple iOS remained
the most listened to aggregator, representing 68.2% of all Libsyn
hosted podcasts
●
Subsequent to the
end of the quarter, Libsyn enabled podcast distribution to India's
largest music streaming service, Gaana
Management Commentary
Laurie
Sims, President and Chief Operating Officer, noted, “We were
very pleased to report double-digit revenue growth and solid
operating profitability in the second quarter of 2020, which is a
testament to the brand recognition of our platform and growth
throughout the podcasting market. The Company successfully
implemented procedures during the COVID-19 pandemic, maintaining
the reliable service offerings and support our customers expect.
Even with the overall decrease in audio consumption across the
industry during the second quarter due to COVID-19, podcast
downloads on the Libsyn platform continue to grow. There was also
more content creation during the second quarter, with new signups
and episode creation increasing.”
Outlook for the Second Half of 2020
Ms.
Sims added, “Following the conclusion of our strategic review
process, we identified distinct areas where Libsyn can work to take
advantage of the significant growth in the podcasting market. We
expect to begin rolling out Libsyn 5 in the next several months,
which will offer greatly improved user interface, workflow and
design changes. The modern design will enable a more streamlined
way to opt-in to additional services from the user’s
perspective. We have listened to customer feedback and continue to
enhance Libsyn 5 to create the best user experience for those just
getting started and for podcasters who require more advance
capabilities.”
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Ms.
Sims continued, “The Company is continuing to evaluate growth
opportunities both domestically in the U.S. and internationally. We
are continuing to embrace our role as a leader in the podcasting
market to expand both podcasts and listeners across the globe. We
are delighted to be one of the sponsors of the Latino Podcast
Listener Report released by Edison Research, as part of our launch
of Latinx initiatives. In addition, subsequent to the end of the
quarter, we announced a new partnership to distribute Libsyn hosted
podcasts on Gaana, India's largest music streaming service. Our
goal remains to empower more voices outside of traditional media
and to support the evolution of podcasting over
time.”
2020 Second Quarter Financial Review
Revenues
Revenues
increased 11.4% to $6.3 million during the quarter ended June 30,
2020, compared to $5.7 million for the same period in 2019. The
increase for 2020 reflects an increase in Libsyn4 hosting revenue
and Premium Subscriptions, offset partially from lower advertising
revenue as advertisers have decreased spending on advertising
campaigns during the quarter.
Libsyn
contributed $4.0 million of revenue during the three months ended
June 30, 2020, compared to $3.6 million in the prior year period.
Pair Networks contributed $2.4 million of revenue during the three
months ended June 30, 2020, compared to $2.1 million in the prior
year period.
Operating Income
The
Company reported operating income of $1.9 million, compared to $0.9
million in the prior year period. The increase was largely driven
by higher revenues and lower cost of revenue and general and
administrative (“G&A”) costs. As a percentage of
revenue, G&A costs declined to 26.6% in the second quarter of
2020 from 33.4% in the prior year period. The decrease was driven
primarily due to a decrease in wage expense, and a decrease in
professional fees.
Income Tax Expense
Income
tax expense for the three months ended June 30, 2020 was $1.6
million, which represents a change in the deferred tax assets and
the expected federal balance due for the three-month period ended
June 30, 2020. This also reflects the uncertain tax position that
the Company has recorded. Income tax expense for the three months
ended June 30, 2019 was $183,932.
Net Income
The
Company’s net income was $275,364, or $0.01 per basic and
diluted share, for the three months ended June 30, 2020, compared
to $664,047, or $0.02 per basic and diluted share, for the three
months ended June 30, 2019.
Liquidity and Capital Resources
Cash on
hand was $19.4 million at June 30, 2020, compared to $16.6 million
at December 31, 2019. Cash provided by operations for the six
months ended June 30, 2020, was $3.8 million, compared to $4.3
million of cash provided by operations for the six months ended
June 30, 2019. The cash contribution for the six months ended June
30, 2020 from Libsyn totaled $3.1 million, and Pair Networks added
$659,182. This decrease is driven from the decrease in management
bonus accrual from the second quarter in 2019.
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Conference Call Details
Libsyn
will discuss these results in a conference call on Friday, August
14, 2020 at 11:00 a.m. ET.
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Participant
Dial-In Numbers:
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(United
States):
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844-602-0380
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(International):
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862-298-0970
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To
access the call, please dial-in approximately five minutes before
the start time. An updated investor presentation deck will be
available for download shortly after the call on the investor
relations website at investor.libsyn.com under the Investor
Resources section.
Submit Questions for the Call
Questions
for consideration for the call can be emailed to investor@libsyn.com
prior to 9:00 a.m. ET on Friday, August 14, 2020.
Conference Call Replay
A
replay of the conference call will be accessible two hours after
the call and available for three weeks at the Investor Resources
section of the investor site: https://investor.libsyn.com.
About Liberated Syndication
Liberated Syndication Inc. (“Libsyn”) is a world
leading podcast hosting network and has been providing publishers
with distribution and monetization services since 2004. In 2019,
Libsyn delivered over 6.2 billion downloads. Libsyn hosts over 5.8
million media files from more than 74,000 podcasts. Podcast
producers choose Libsyn to measure their audience via IAB V2
certified stats, deliver popular audio and video episodes,
distribute their content through smartphone apps (iOS and Android),
and monetize via premium subscription services and advertising. The
Company also owns Pair Networks, founded in 1996, one of the oldest
and most experienced Internet hosting companies, providing a full
range of fast, powerful and reliable Web hosting
services.
Libsyn is a Pittsburgh-based company with a world class
team.
Visit Libsyn on the web at
www.libsyn.com and
visit Pair Networks at
www.pair.com.
Investors can visit the Company at the “Investor
Relations” section of Libsyn’s website at
https://investor.libsyn.com.
Forward-Looking Statement
“Forward-looking
Statements” as defined in the Private Securities Litigation
Reform Act of 1995 may be included in some of the information or
materials discussed in this press release. These statements relate
to future events or our future financial performance.
These
statements are only predictions and may differ materially from
actual future results or events. We disclaim any intention or
obligation to revise any forward-looking statements whether as a
result of new information, future developments or otherwise, except
as required by law. There are important risk factors that could
cause actual results to differ from those contained in
forward-looking statements, including, but not limited to, risks
related to the outbreak of the coronavirus (“COVID-19”)
and the global spread of COVID-19 during 2020, risks associated
with our change in business strategy towards more heavy reliance
upon on our new talent segment and wholesale channels, risks
related to our recent management and Board of Directors changes,
actions of regulators concerning our business operations or trading
markets for our securities, the extent to which we are able to
develop new services and markets for our services, our significant
reliance on third parties to distribute our content, the level of
demand and market acceptance of our services and the "Risk Factors"
set forth in our most recent Securities and Exchange Commission
filings.
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Contact:
At the
Company:
Laurie
Sims, President and Chief Operating Officer
Liberated
Syndication
investor@libsyn.com
Adam
Prior, SVP
The
Equity Group Inc.
(212)
836-9606
aprior@equityny.com
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LIBERATED
SYNDICATION INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
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Three Months
Ended
June
30,
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Six Months
Ended
June
30,
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2020
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2019
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2020
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2019
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Revenue
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$6,349,742
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$5,700,635
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$12,602,493
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$11,983,614
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Costs and operating
expenses
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Cost of revenue
(excluding depreciation and amortization)
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622,301
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860,848
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1,429,537
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1,700,488
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General and
administrative
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1,687,822
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1,905,567
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3,637,863
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3,734,106
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Technology
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577,782
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457,151
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1,158,852
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911,789
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Selling
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299,010
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214,542
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529,822
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409,336
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Customer
support
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725,948
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648,565
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1,477,115
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1,308,433
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Depreciation and
amortization
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510,326
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745,093
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1,024,330
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1,487,190
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Total costs and
operating expenses
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4,423,189
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4,831,766
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9,257,519
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9,551,342
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Operating
income
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1,926,553
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868,869
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3,344,974
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2,432,272
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Other income
(expense)
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Interest
expense
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(34,162)
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(82,880)
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(96,504)
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(169,722)
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Interest
income
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8,951
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59,738
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67,385
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111,689
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Other income
benefit (expense)
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1,215
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2,252
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11,349
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1,373
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Total other income
(expense)
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(23,996)
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(20,890)
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(17,770)
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(56,660)
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Income from
operations before income taxes
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1,902,557
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847,979
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3,327,204
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2,375,612
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Income tax
expense
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1,627,193
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183,932
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1,931,729
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510,942
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Net
Income
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$275,364
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$664,047
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$1,395,475
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$1,864,670
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BASIC AND DILUTED
INCOME PER COMMON SHARE
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$0.01
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$0.02
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$0.05
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$0.06
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BASIC AND DILUTED
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
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29,290,724
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29,336,260
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29,281,349
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29,528,051
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LIBERATED
SYNDICATION INC. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
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June
30,
2020
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December
31,
2019
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CURRENT
ASSETS:
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(Unaudited)
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Cash
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$19,432,706
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$16,621,272
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Accounts
receivable, net
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429,545
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549,044
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Prepaid
expenses
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1,102,982
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614,417
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Total current
assets
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20,965,233
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17,784,733
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Property and
equipment, net
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1,252,895
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1,536,930
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Goodwill
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16,388,171
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16,388,171
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Definite life -
intangible assets, net
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5,353,714
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5,929,371
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Prepaid
expense
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414,302
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363,091
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Operating lease
right-of-use assets
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533,598
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751,731
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Deferred tax
assets
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2,052,691
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1,847,979
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Total
assets
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$ 46,960,604
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$44,602,006
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CURRENT
LIABILITIES:
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Accounts
payable
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$701,262
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$760,163
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Accrued
expenses
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589,743
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1,087,271
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Income tax
payable
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4,184,359
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2,047,917
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Deferred
revenue
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2,680,666
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2,511,682
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Current portion of
capital lease obligation
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-
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831
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Current portion of
loans payable, net
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2,646,594
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2,643,824
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386,349
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408,828
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Total current
liabilities
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11,188,973
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9,460,516
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LONG-TERM
LIABILITIES:
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Loans payable, net
of current portion
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1,313,876
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2,104,611
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Deferred revenue,
net of current portion
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681,663
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601,234
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Operating lease
liabilities, net of current portion
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147,249
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342,903
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Line of
credit
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2,000,000
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2,000,000
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Total long-term
liabilities
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4,142,788
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5,048,748
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Total
liabilities
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15,331,761
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14,509,264
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COMMITMENTS &
CONTINGENCIES
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-
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-
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STOCKHOLDERS'
EQUITY
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Common
stock
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29,310
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29,272
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Additional
paid-in capital
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35,383,759
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35,243,171
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Accumulated
deficit
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(3,784,226)
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(5,179,701)
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Total
stockholders' equity
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31,628,843
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30,092,742
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Total
liabilities and stockholders' equity
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$46,960,604
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$44,602,006
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