May 9, 2018 NTN Buzztime, Inc. Reports First Quarter 2018 Results
– Grew Revenue to $5.8 Million, Up 10% from Q1 2017 –
– Improved Gross Margins to 66%, Up from 65% in Q1 2017 –
– Achieved Eighth Consecutive Quarter of Positive EBITDA –
CARLSBAD, Calif., May 9, 2018, — NTN Buzztime, Inc. (NYSE American: NTN), reported financial results for the first quarter ended March 31, 2018.
“The first quarter of 2018 ended quite strong: compared to the prior year quarter, revenues grew 10%, gross margin improved one point to 66%, SG&A as a percent of revenue decreased nine points, and EBITDA was positive for the eighth consecutive quarter,” said Ram Krishnan, NTN Buzztime CEO. “Sales and partnerships also advanced during the quarter. Our new tablets with order and pay using magnetic swipe, EMV and NFC capabilities are live again at 26 Buffalo Wild Wings. We also won an order for several thousand tablets, securing a partner who wants to leverage both our hardware and operating system in an entirely new vertical. And to increase ad sales, we entered into new agreements with both ad tech and reselling partners. Our investments in product development are progressing and are focused on positioning us to scale the business by expanding our addressable market within the bar and restaurant space while opening up new markets. Our product extensions include a new system management hub built on our android platform; a single-unit charger; a first release of our mobile, live trivia event platform; and a Buzztime developed arcade game, Buzztime Soccer, which we launched this week. We are working diligently to execute on our strategy, and together with the board, we are committed to building long-term shareholder value.”
Financial Results for the First Quarter Ended March 31, 2018
Total revenues were $5.8 million, up from $5.2 million for the first quarter of 2017, as sales-type lease and professional development revenue increases offset lower subscription revenue. Direct costs were $2.0 million, compared to $1.8 million for the same period in 2017 primarily related to higher equipment lease revenue and depreciation expense. Gross margin increased to 66%, up from 65% in the prior year quarter. Selling, general and administrative expense was $4.0 million, or 70% of revenue, down from $4.1 million, or 79% of revenue, for the first quarter of 2017. Net loss was $409,000, or $0.16 per share. In the first quarter of 2017, the company recognized a one-time payment from a supplier resulting in the lower net loss of $90,000, or $0.04 per share. EBITDA was $325,000, compared to $654,000 that also benefited from supplier payment the in the first quarter of 2017.
EBITDA is defined as earnings before interest, taxes, depreciation and amortization and is not intended to represent a measure of performance in accordance with accounting principles generally accepted in the United States (GAAP). Although EBITDA is positive this quarter, it may not be positive in future quarters. A detailed description and reconciliation of EBITDA and management’s reasons for using this measure is set forth at the end of this press release.
Metric Review for the Quarter March 31,2018
The site count was 2,703 compared to 2,730 at December 31, 2017. Management anticipates the net site count will continue to fluctuate. As of March 31, 2018, BEOND platform installations increased to 2,218 venues, or 82% of the installed base, compared to 2,201 venues, or 81% of the installed base, as of December 31, 2017.
Cash and cash equivalents were $2.6 million at March 31, 2018, compared to $3.4 million at December 31, 2017. Total deferred revenue was $3.5 million, down from $3.6 million at December 31, 2017.
Management will review the results on a conference call with a live question and answer session today, May 9, 2018, at 4:30 p.m. ET. To access the call, please use passcode 2269778 and dial:
(877) 307-1373 for the live call and (855) 859-2056 for the replay, if calling from the United States or Canada; or
(678) 224-7873 for the live call and (404) 537-3406 for the replay, if calling internationally.
The call will also be accompanied live by webcast that will be accessible at the company’s website at https://www.buzztime.com. The replay of the call will be available until May 16, 2018.
This release contains forward-looking statements that reflect management’s current views of future events and operations, including statements regarding the progress of our product development investments, new market opportunities, and management’s execution of its strategy. These risks and uncertainties include the risks of unsuccessful execution or launch of products, platforms or brands, risks associated with customer retention and growth plans, the impact of alternative entertainment options and technologies and competitive products, brands, technologies and pricing, adverse economic conditions, the regulatory environment and changes in the law, failure of customer and/or player acceptance or demand for new or existing products, lower market acceptance or appeal of both existing and new products and services by particular demographic groups or audiences as a whole, termination of partnership and contractual relationships and technical problems or outages. Please see NTN Buzztime, Inc.’s recent filings with the Securities and Exchange Commission for information about these and other risks that may affect the Company. All forward-looking statements included in this release are based on information available to us on the date hereof. These statements speak only as of the date hereof and NTN Buzztime, Inc. does not undertake to publicly update or revise any of its forward-looking statements, even if experience or future changes show that the indicated results or events will not be realized.
Buzztime (NYSE American: NTN) delivers interactive entertainment and innovative technology, including performance analytics and secure payment with Europay, MasterCard® and Visa® (EMV) chip card readers or with near-field communication (NFC) technology to accept Apple, Android and Samsung Pay. Most frequently used in bars and restaurants in North America, the Buzztime tablets and technology offer engaging solutions to establishments that have guests who experience dwell time, such as casinos, senior living, car dealerships and more. Casual dining venues license Buzztime’s customizable solution to differentiate themselves via competitive fun by offering guests trivia, card, sports and arcade games, personalized menus and self-service dining features. Buzztime’s platform improves operating efficiencies, creates connections among the players and venues, and amplifies guests’ positive experiences. The Buzztime platform has also been recently resold and the content licensed for other businesses serving other markets. For more information, please visit https://www.buzztime.com or follow us on Facebook or Twitter @buzztime.