–Increased site count for the second quarter in a row–
–Signed two master service agreements with experience-focused chains–
–Deployed payment capabilities with established partner venue–
CARLSBAD, Calif., November 5, 2015 — NTN Buzztime, Inc. (NYSE MKT: NTN), reported financial results for the third quarter ended September 30, 2015.
“Our third quarter revenue met our expectations and, sequentially, we cut our net loss in half,” said Ram Krishnan, NTN Buzztime CEO. “Buzztime helps restaurants and bars differentiate their brands, amplify the guests’ experience and improve operating efficiencies. With chains in mind, we continue to invest in entertainment and dining technology. Our next generation tablet platform, which incorporates payment capabilities with secure EMV technology, is generally available and is getting rave reviews. Arooga’s is using tableside payment, and initial feedback shows restaurants experiencing faster table turns, higher check averages and bigger tips for servers. In addition, we have expanded two relationships signing master service agreements that make Buzztime the brand standard for Buffalo Wings and Rings and Old Chicago.”
- Technology conversion: Buzztime has converted roughly 1,000 Buffalo Wild Wings locations onto the BEOND tablet platform and expects to complete installation at all sites locations by year end. At September 30th, over 56% of the Buzztime installed base was on the BEOND tablet platform.
- Entertainment expansion: Driving to enhance the entertainment offering, Buzztime launched two new games in the quarter: Buzztime Sports: Football Edition and Academy of Football hosted by Emmitt Smith. Also, Jackpot Trivia, launched earlier this year, is now the number one played trivia game in the Buzztime network.
- Customer expansion: Two brands recently signed master service agreements (MSA) naming Buzztime as their exclusive partners for tableside entertainment. The first, Buffalo Wings and Rings already has 20 of its 46 sites installed. Old Chicago, our second newly signed MSA, has more than 100 locations and 35 sites already installed. In addition, Buzztime partner Arooga’s has already begun utilizing the payment feature.
- Premium service expansion: Buzztime is developing a broader set of premium services including a premium arcade and a platform for third parties to offer content and services.
“I am proud of our 2015 accomplishments, particularly as we reorganized the company structure and addressed production challenges. We continue to manage corporate and production costs and are demonstrating continued progress toward becoming adjusted EBITDA positive. Looking ahead, we will further our entertainment and dining technology, pursue experience-focused brands and roll-out premium services. Our efforts continue to focus on delivering long-term shareholder value,” concluded Krishnan.
Financial Results for the Third-Quarter Ended September 30, 2015
Total revenues were $6.1 million for the third quarter of 2015 compared to $6.0 million for the same period in 2014. As expected, increases in both sales-type lease arrangements and other revenue were slightly offset by a decrease in subscription revenue due to lower average site count and lower average revenue per site. Direct costs were $3.2 million for the third quarter of 2015 compared to $2.3 million for the same period in 2014. The increase in direct costs included $480,000 for increased repair expenses, $186,000 for increased equipment and production costs, and increased scrap expense of $73,000. Selling, general and administrative expenses were $4.1 million for the third quarter of 2015 compared to $4.9 million for the same period in 2014 reflecting a leaner company structure. For both periods, net loss was $1.3 million, or $0.01 per share.
Sequentially, revenue for the third quarter of 2015 was down approximately $114,000 compared to the second quarter of 2015 due to decreases in sales-type lease arrangements and advertising, offset by increases in subscription, professional and other revenues. However, due to operating cost management, net loss was reduced by approximately 49% from $2.6 million of net loss in the second quarter of 2015 compared to $1.3 million of net loss in the third quarter of 2015.
Metric Review for Quarter Ended September 30, 2015 Compared to June 30, 2015
The company grew its site count for the second quarter in a row, ending the third quarter of 2015 with 2,952 subscribing venues, compared to 2,942 as of June 30, 2015 However, management anticipates the net count will continue to fluctuate and decline in the fourth quarter. As of September 30, 2015, BEOND installations increased to 1,666 locations, or 56% of the installed base, compared to 50% as of June 30, 2015. The Buzztime network has eight million registered players.
Liquidity at September 30, 2015
As of September 30, 2015, cash and cash equivalents were $4.7 million, compared to $7.2 million as of December 31, 2014. Working capital was $4.0 million, compared to $4.9 million as of June 30, 2015.
Management will review the results on a conference call today, November 5, 2015, at 4:30 p.m. ET. To access the call, please use passcode 66915871 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 over the Internet and accessible at the company’s website at https://www.buzztime.com. The replay of the call will be available until November 12, 2015.
This release contains forward-looking statements which reflect management’s current views of future events and operations, including but not limited to statements about our growth plans, product and platform development, launches and usage, new revenue and the effect of cost control measures, acceptance in the marketplace, customer development, customer and consumer satisfaction and the number of locations, players and games. These statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially. 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 MKT: NTN) delivers interactive entertainment and innovative dining technology to bars and restaurants in North America. Venues license Buzztime’s customizable solution to differentiate themselves via competitive fun by offering guests trivia, card, sports and arcade games, nationwide competitions, 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. Founded in 1984, Buzztime has accumulated over 8 million player registrations and over 80 million games were played in 2014 alone. For more information, please visit https://www.buzztime.com or follow us on Facebook or Twitter @buzztime.
IR AGENCY CONTACT:
Kirsten Chapman/Becky Herrick, LHA
(financial tables follow)