TORONTO, March 6, 2014 – Mood Media Corporation (ISIN: CA61534J1057) (TSX:MM / LSE AIM:MM), the world’s largest integrated provider of in-store customer experience solutions, today reported results for the fourth quarter and full year 2013, and provided an update on strategic and operational initiatives.
- Significantly strengthened senior leadership team with several key appointments:
- Tom Garrett appointed as EVP & Chief Financial Officer
- Claude Nahon appointed as President of Mood International
- David Van Epps appointed as Global Chief Product Officer & EVP of Local Sales
- Successfully completed implementation of Wave 1 of its business efficiency and integration synergy program, focused on streamlining Mood Media’s operating infrastructure to create efficiencies and enhance profitability, and positioning Mood Media to capture opportunities for growth across Local Audio, Visual Solutions and Mobile Services.
- Launched Waves 2 and 3 of its efficiency and integration synergy program, expecting to deliver $8-$12 million in annualized savings. Initiatives included in Waves 2 and 3 are expected to be fully implemented by June 30th and year end, respectively.
- Achieved fourth quarter revenues of $132 million and EBITDA of $24 million as previously reported.
“Since I joined Mood Media just over 5 months ago, we have taken important steps forward in establishing an active program to integrate our businesses, improve our cost structure and lay a strong foundation for long-term growth,” said Steve Richards, President and CEO of Mood Media. “During the fourth quarter, we completed the initiatives associated with Wave 1 of our business efficiency and integration synergy program as committed, and ahead of schedule, and we expect these improvements to deliver nearly $9 million in annual cost savings. Since then, we have finalized the majority of our plans for Waves 2 and 3, and expect to fully implement those initiatives, by the end of 2014. We expect that our actions associated with Waves 2 and 3 will deliver substantial annualized savings in the range of $8 to $12 million as originally proposed in the fall of 2013, once our implementation efforts are complete.
“To drive these changes, we enhanced Mood’s senior management team and added talented, experienced executives who will play a vital role in driving enhanced execution, as we further streamline our business processes and position Mood to better leverage our considerable advantages” continued Mr. Richards. “Looking ahead, while we continue to face a relatively subdued retail environment, we have a dynamic strategy in place to drive growth and we are executing relentlessly on our plans. As a result, we believe we will improve our profitability throughout 2014 and expect to see sequential improvement in this metric beginning in the second quarter and that our second half 2014 performance will outpace our first half performance. We have made very solid progress over the past 150 days, and I am highly confident in Mood’s ability to enhance our value for shareholders and stakeholders.”
Fourth Quarter Financial Results
The Company reported Q4 revenues of $132 million and EBITDA of $24 million. Net loss per share from continuing operations was ($0.07) compared with net loss of ($0.08) in the prior-year period. The Company’s fourth quarter revenue performance was impacted by higher volumes of low-margin equipment sales, which contributed to the revenue improvement but adversely affected EBITDA in the quarter. The Company has since de-emphasized this activity. In addition, as previously reported, EBITDA in the fourth quarter was impacted by more than $4 million in non-recurring expenses as well as its revised agreement with its U.S. affiliates.
Other expense totaled $5.5 million in the quarter related to restructuring, integration and transaction expenses and compare with $15.5 million a year earlier. Restructuring and integration activities totaled $4.5 million in the quarter and include a $0.5 million accrual related to its revised arrangement with its independent affiliates as well as severance, integration and other expenses related to its integration, consolidation and synergy program.
KEY PERFORMANCE INDICATORS
In the fourth quarter, the Company recorded relatively stable performance in terms of its number of subscriber sites at 426,620. Its blended monthly churn rate of 0.8% was consistent with its performance on average throughout 2013. Blended monthly ARPU of $55.15 represents a moderate decline of 2% relative to the prior quarter.
Board of Directors
Effective January 1, 2014, Kevin Dalton was appointed to the Board of Directors and in February 2014, Mr. Dalton was appointed Lead Director of the Board. In addition, in January 2014 Gary Shenk and David Richards were appointed to the Board of Directors, with Lorne Abony and Justin Beckett stepping down.
In February 2014, the Board of Directors reconstituted its Compensation and Governance Committee appointing Mr. Kevin Dalton (Chair), Mr. David Richards and Mr. Harvey Solursh as members of this committee. In March 2014, effective immediately following the release of the Company’s audited consolidated financial statements for the year ended December 31, 2013, the Board of Directors reconstituted its Audit Committee appointing Mr. Harvey Solursh (Chair), Mr. David Richards and Mr. Gary Shenk as members of this committee.
As previously announced, the Company will hold a conference call today at 8:30 a.m. Eastern Time to discuss its results and respond to questions from the investment community. The call can be accessed by telephone by dialing (416) 764-8658, or 1 (888) 886-7786 for international callers. Listeners are advised to dial in at least five minutes prior to the call.
A replay of the conference call will be available for one month following the event by dialing 416-764-8691 or 1-877-674-6060 and entering PIN 035960.
This earnings release, which is current as of March 6, 2014, is a summary of our fourth quarter and 2013 results, and should be read in conjunction with our 2013 MD&A and our 2013 Consolidated Financial Statements and Notes thereto and our other recent filings with securities regulatory authorities in Canada and the United Kingdom.
The financial information presented herein has been prepared on the basis of IFRS for interim financial statements and is expressed in United States dollars unless otherwise stated.
This news release includes certain non-IFRS financial measures. Mood Media uses these non-IFRS financial measures as supplemental indicators of its operating performance and financial position. These measures do not have any standardized meanings prescribed by IFRS and therefore may not be comparable to the calculation of similar measures used by other companies, and should not be viewed as alternatives to measures of financial performance calculated in accordance with IFRS.
In this earnings release, the terms “we”, “us”, “our”, “Mood Media” and “the Company” refer to Mood Media Corporation and our subsidiaries.
MOOD MEDIA CORPORATION
Selected Financial Information
Three months ended
December 31, 2013
December 31, 2012
December 31, 2013
December 31, 2012
December 31, 2011
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|Loss for the period before taxes|
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|Loss for the year from continuing operations|
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|Basic and diluted from continuing operations|
|Basic and diluted from discontinued operations|
Posted: Thursday, March 6, 2014