Second Quarter Financial Results
(in thousands) | Q2 23 | Q2 22 | YOY Change | Q2 23 YTD | Q2 22 YTD | YOY Change | |||||||
Total Revenues | $ | 4,493 | $ | 4,699 | (4.4 | %) | $ | 8,977 | $ | 9,247 | (2.9 | %) | |
Operating Income | 149 | 1,040 | (85.7 | %) | 378 | 1,914 | (80.3 | %) | |||||
Income Before Provision for Taxes | 88 | 1,148 | (92.3 | %) | 298 | 2,013 | (85.2 | %) | |||||
Net (Loss) Income | (14 | ) | 921 | (101.5 | %) | 145 | 1,660 | (91.3 | %) | ||||
Gross Billings* | 17,541 | 17,604 | (0.4 | %) | 35,128 | 34,249 | 2.6 | % | |||||
EBITDA* | 144 | 1,197 | (88.0 | %) | 406 | 2,124 | (80.9 | %) | |||||
Adjusted EBITDA* | 230 | 1,142 | (79.9 | %) | 534 | 2,130 | (74.9 | %) | |||||
Pre-Corporate EBITDA* | 476 | 1,364 | (65.1 | %) | 1.024 | 2,606 | (60.7 | %) | |||||
*Non-GAAP measures referenced are detailed in the disclosures at the end of this release. |
Financial Results
Net loss for the three months ended
Pre-Corporate EBITDA was
The following table reconciles reported total revenues under generally accepted accounting principles to Gross Billings, for the three and six months ended
(in thousands) | Three months ended | Six months ended | ||
2023 | 2022 | 2023 | 2022 | |
Total Revenues | 4,493 | 4,699 | 8,977 | 9,247 |
Model costs | 13,048 | 12,905 | 26,151 | 25,002 |
Gross billings* | 17,541 | 17,604 | 35,128 | 34,249 |
*Non-GAAP measures referenced are detailed in the disclosures at the end of this release. |
Model costs include amounts owed to talent, including taxes required to be withheld and remitted directly to taxing authorities, commissions owed to other agencies, and related costs such as those paid for photography.
The following table reconciles reported net income under generally accepted accounting principles to EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA for the three and six months ended
(in thousands) | Three months ended | Six months ended | |||||
2023 | 2022 | 2023 | 2022 | ||||
Net (loss) income | (14 | ) | 921 | 145 | 1,660 | ||
Interest expense | - | 2 | 1 | 5 | |||
Income tax expense | 102 | 227 | 153 | 353 | |||
Amortization and depreciation | 56 | 47 | 107 | 106 | |||
EBITDA* | 144 | 1,197 | 406 | 2,124 | |||
Foreign exchange loss (gain) | 61 | (110 | ) | 79 | (104 | ) | |
Share-based payment expense | 25 | 55 | 49 | 110 | |||
Adjusted EBITDA* | 230 | 1,142 | 534 | 2,130 | |||
Corporate overhead | 246 | 222 | 490 | 476 | |||
Pre-Corporate EBITDA* | 476 | 1,364 | 1,024 | 2,606 | |||
*Non-GAAP measures referenced are detailed in the disclosures at the end of this release. |
Changes in net income, EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA for the three and six months ended
- Total revenues for the three and six months ended
June 30, 2023 decreased by 4.4% and 2.9% due to decreased commissions on bookings in the Company’s core modeling divisions; - Salaries and service costs for the three and six months ended
June 30, 2023 increased by 10.5% and 9.5% primarily due to personnel hires and payroll changes to better align Wilhelmina staffing with the needs of each office and geographical region; - Office and general expenses for the three and six months ended
June 30, 2023 increased by 53.4% and 52.9% primarily due to increased legal expense, rent expense, utilities, and other office related expenses.; - Amortization and depreciation expense for the three and six months ended
June 30, 2023 increased by 19.1% and 0.9%, primarily due to increased depreciation of capitalized furniture and leasehold assets at the Company’s newNew York City office; and - Corporate overhead expenses for the three and six months ended
June 30, 2023 increased by 10.8% and 2.9%, primarily due to increased corporate travel expenses and the timing of audit costs incurred earlier than the prior year.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited) | ||||||||||
2023 | 2022 | |||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 10,943 | $ | 11,998 | ||||||
Accounts receivable, net of allowance for doubtful accounts of | 9,965 | 9,467 | ||||||||
Prepaid expenses and other current assets | 214 | 181 | ||||||||
Total current assets | 21,122 | 21,646 | ||||||||
Property and equipment, net of accumulated depreciation of | 340 | 307 | ||||||||
Right of use assets-operating | 3,429 | 3,565 | ||||||||
Right of use assets-finance | 108 | 138 | ||||||||
Trademarks and trade names with indefinite lives | 8,467 | 8,467 | ||||||||
7,547 | 7,547 | |||||||||
Other assets | 301 | 322 | ||||||||
TOTAL ASSETS | $ | 41,314 | $ | 41,992 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable and accrued liabilities | $ | 3,883 | $ | 4,306 | ||||||
Due to models | 7,815 | 8,378 | ||||||||
Contract liabilities | - | 270 | ||||||||
Lease liabilities – operating, current | 572 | 385 | ||||||||
Lease liabilities – finance, current | 64 | 62 | ||||||||
Total current liabilities | 12,334 | 13,401 | ||||||||
Long term liabilities: | ||||||||||
Deferred income tax, net | 1,138 | 985 | ||||||||
Lease liabilities – operating, non-current | 3,187 | 3,310 | ||||||||
Lease liabilities – finance, non-current | 52 | 85 | ||||||||
Total long term liabilities | 4,377 | 4,380 | ||||||||
Total liabilities | 16,711 | 17,781 | ||||||||
Shareholders’ equity: | ||||||||||
Common stock, | ||||||||||
issued and outstanding at | 65 | 65 | ||||||||
(6,371 | ) | (6,371 | ) | |||||||
Additional paid-in capital | 88,819 | 88,770 | ||||||||
Accumulated deficit | (57,564 | ) | (57,709 | ) | ||||||
Accumulated other comprehensive loss | (346 | ) | (544 | ) | ||||||
Total shareholders’ equity | 24,603 | 24,211 | ||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 41,314 | $ | 41,992 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
For the Three and Six Months Ended
(In thousands, except for share and per share data)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||
Revenues: | ||||||||||||||||||||
Service revenues | $ | 4,486 | $ | 4,691 | $ | 8,962 | $ | 9,232 | ||||||||||||
License fees | 7 | 8 | 15 | 15 | ||||||||||||||||
Total revenues | 4,493 | 4,699 | 8,977 | 9,247 | ||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Salaries and service costs | 2,979 | 2,697 | 5,859 | 5,349 | ||||||||||||||||
Office and general expenses | 1,063 | 693 | 2,143 | 1,402 | ||||||||||||||||
Amortization and depreciation | 56 | 47 | 107 | 106 | ||||||||||||||||
Corporate overhead | 246 | 222 | 490 | 476 | ||||||||||||||||
Total operating expenses | 4,344 | 3,659 | 8,599 | 7,333 | ||||||||||||||||
Operating income | 149 | 1,040 | 378 | 1,914 | ||||||||||||||||
Other expense (income): | ||||||||||||||||||||
Foreign exchange loss (gain) | 61 | (110 | ) | 79 | (104 | ) | ||||||||||||||
Interest expense | - | 2 | 1 | 5 | ||||||||||||||||
Total other expense (income) | 61 | (108 | ) | 80 | (99 | ) | ||||||||||||||
Income before provision for income taxes | 88 | 1,148 | 298 | 2,013 | ||||||||||||||||
Provision for income taxes: | ||||||||||||||||||||
Current | 56 | (54 | ) | - | (84 | ) | ||||||||||||||
Deferred | (158 | ) | (173 | ) | (153 | ) | (269 | ) | ||||||||||||
Provision for income taxes, net | (102 | ) | (227 | ) | (153 | ) | (353 | ) | ||||||||||||
Net (loss) income | $ | (14 | ) | $ | 921 | $ | 145 | $ | 1,660 | |||||||||||
Other comprehensive income (loss): | ||||||||||||||||||||
Foreign currency translation adjustment | 112 | (338 | ) | 198 | (512 | ) | ||||||||||||||
Total comprehensive income | $ | 98 | $ | 583 | $ | 343 | $ | 1,148 | ||||||||||||
Basic net income per common share | $ | 0.00 | $ | 0.18 | $ | 0.03 | $ | 0.32 | ||||||||||||
Diluted net income per common share | $ | 0.00 | $ | 0.18 | $ | 0.03 | $ | 0.32 | ||||||||||||
Weighted average common shares outstanding-basic | 5,157 | 5,157 | 5,157 | 5,157 | ||||||||||||||||
Weighted average common shares outstanding-diluted | 5,157 | 5,157 | 5,157 | 5,157 |
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
For the Three and Six Months Ended
(In thousands)
Common Shares | Stock Amount | Shares | Stock Amount | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,580 | $ | (61,238 | ) | $ | (23 | ) | $ | 21,013 | ||||||||||||||||
Share based payment expense | - | - | - | - | 55 | - | - | 55 | ||||||||||||||||||||||||||
Net income | - | - | - | - | - | 739 | - | 739 | ||||||||||||||||||||||||||
Foreign currency translation | - | - | - | - | - | - | (174 | ) | (174 | ) | ||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,635 | $ | (60,499 | ) | $ | (197 | ) | $ | 21,633 | ||||||||||||||||
Share based payment expense | - | - | - | - | 55 | - | - | 55 | ||||||||||||||||||||||||||
Net income | - | - | - | - | - | 921 | - | 921 | ||||||||||||||||||||||||||
Foreign currency translation | - | - | - | - | - | - | (338 | ) | (338 | ) | ||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,690 | $ | (59,578 | ) | $ | (535 | ) | $ | 22,271 |
Common Shares | Stock Amount | Shares | Stock Amount | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total | ||||||||||||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,770 | $ | (57,709 | ) | $ | (544 | ) | $ | 24,211 | |||||||||||||||||||||||
Share based payment expense | - | - | - | - | 24 | - | - | 24 | |||||||||||||||||||||||||||||||||
Net income | - | - | - | - | - | 159 | - | 159 | |||||||||||||||||||||||||||||||||
Foreign currency translation | - | - | - | - | - | - | 86 | 86 | |||||||||||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,794 | $ | (57,550 | ) | $ | (458 | ) | $ | 24,480 | |||||||||||||||||||||||
Share based payment expense | - | - | - | - | 25 | - | - | 25 | |||||||||||||||||||||||||||||||||
Net loss | - | - | - | - | - | (14 | ) | - | (14 | ) | |||||||||||||||||||||||||||||||
Foreign currency translation | - | - | - | - | - | - | 112 | 112 | |||||||||||||||||||||||||||||||||
Balances at | 6,472 | $ | 65 | (1,315 | ) | $ | (6,371 | ) | $ | 88,819 | $ | (57,564 | ) | $ | (346 | ) | $ | 24,603 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
For the Six Months Ended
(In thousands)
(Unaudited)
Six Months Ended | ||||||||||
2023 | 2022 | |||||||||
Cash flows from operating activities: | ||||||||||
Net income: | $ | 145 | $ | 1,660 | ||||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||||
Amortization and depreciation | 107 | 106 | ||||||||
Share based payment expense | 49 | 110 | ||||||||
Loss (gain) on foreign exchange rates | 79 | (104 | ) | |||||||
Deferred income taxes | 153 | 269 | ||||||||
Bad debt expense | 82 | 79 | ||||||||
Changes in operating assets and liabilities: | ||||||||||
Accounts receivable | (659 | ) | (2,412 | ) | ||||||
Prepaid expenses and other current assets | (33 | ) | (116 | ) | ||||||
Right of use assets-operating | 349 | 238 | ||||||||
Other assets | 21 | (227 | ) | |||||||
Due to models | (563 | ) | 681 | |||||||
Lease liabilities-operating | (149 | ) | (240 | ) | ||||||
Contract liabilities | (270 | ) | (535 | ) | ||||||
Accounts payable and accrued liabilities | (423 | ) | 14 | |||||||
Net cash used in operating activities | (1,112 | ) | (477 | ) | ||||||
Cash flows from investing activities: | ||||||||||
Purchases of property and equipment | (109 | ) | (18 | ) | ||||||
Net cash used in investing activities | (109 | ) | (18 | ) | ||||||
Cash flows from financing activities: | ||||||||||
Payments on finance leases | (32 | ) | (33 | ) | ||||||
Net cash used in financing activities | (32 | ) | (33 | ) | ||||||
Foreign currency effect on cash flows: | 198 | (412 | ) | |||||||
Net change in cash and cash equivalents: | (1,055 | ) | (940 | ) | ||||||
Cash and cash equivalents, beginning of period | 11,998 | 10,251 | ||||||||
Cash and cash equivalents, end of period | $ | 10,943 | $ | 9,311 | ||||||
Supplemental disclosures of cash flow information: | ||||||||||
Cash paid for income taxes | $ | 49 | $ | 5 | ||||||
Non-GAAP Financial Measures
Gross Billings, EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA represent measures of financial performance that are not calculated and presented in accordance with
- are key operating metrics of the Company's business;
- are used by management in its planning and budgeting processes and to monitor and evaluate its financial and operating results; and
- provide stockholders and potential investors with a means to evaluate the Company's financial and operating results against other companies within the Company's industry.
The Company's calculation of non-GAAP financial measures may not be consistent with similar calculations by other companies in the Company's industry. The Company calculates Gross Billings as the gross amounts billed to customers on behalf of its models and talent for services performed. The Company calculates EBITDA as net income plus interest expense, income tax expense, and depreciation and amortization expense. The Company calculates “Adjusted EBITDA” as EBITDA plus foreign exchange gain/loss, share-based payment expense and certain significant non-recurring items that the Company may include from time to time. There were no such non-recurring items during the six months ended
Non-GAAP financial measures should not be considered as alternatives to net and operating income as an indicator of the Company's operating performance or cash flows from operating activities as a measure of liquidity or any other measure of performance derived in accordance with generally accepted accounting principles.
Form 10-Q Filing
Additional information concerning the Company's results of operations and financial position is included in the Company's Form 10-Q for the second quarter ended
Forward-Looking Statements
This press release contains certain “forward-looking” statements as such term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relating to the Company are based on the beliefs of the Company’s management as well as information currently available to the Company’s management. When used in this report, the words “anticipate,” “believe,” “estimate,” “expect” and “intend” and words or phrases of similar import, as they relate to the Company or Company management, are intended to identify forward-looking statements. Such forward-looking statements include, in particular, projections about the Company’s future results, statements about its plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. Additionally, statements concerning future matters such as gross billing levels, revenue levels, expense levels, and other statements regarding matters that are not historical are forward-looking statements. Management cautions that these forward-looking statements relate to future events or the Company’s future financial performance and are subject to business, economic, and other risks and uncertainties, both known and unknown, that may cause actual results, levels of activity, performance, or achievements of its business or its industry to be materially different from those expressed or implied by any forward-looking statements. Should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company does not undertake any obligation to publicly update these forward-looking statements. As a result, no person should place undue reliance on these forward-looking statements.
About
Wilhelmina, together with its subsidiaries, is an international full-service fashion model and talent management service, specializing in the representation and management of leading models, celebrities, artists, photographers, athletes, and content creators. Established in 1967 by fashion model
CONTACT: Investor Relations
214-661-7488
ir@wilhelmina.com
Source:
2023 GlobeNewswire, Inc., source