DALLAS, Nov. 20, 2012 (GLOBE NEWSWIRE) -- Wilhelmina International, Inc. (OTCQX:WHLM) (the "Company") today reported total revenues of $13.6 million and $42.4 million for the three and nine months ended September 30, 2012, respectively, compared to $13.5 million and $42.0 million for the three and nine months ended September 30, 2011, respectively.
The net income applicable to common stockholders was $332,000 or $0.00 per fully diluted share and $1,172,000 or $0.01 per fully diluted share for the three and nine months ended September 30, 2012, respectively, compared to a net income of $63,000 or $0.00 per fully diluted share and $1,421,000 or $0.01 per fully diluted share for the three and nine months ended September 30, 2011, respectively.
The net income for the three and nine months ended September 30, 2012 includes before tax charges of $387,000 and $1,172,000 for amortization of intangible assets and depreciation and $301,000 and $1,144,000 for corporate overhead, respectively. The net income for the three and nine months ended September 30, 2011 includes before tax charges of $401,000 and $1,238,000 for amortization of intangible assets and depreciation and $327,000 and $907,000 for corporate overhead, respectively.
During the quarter ended September 30, 2012, the Company repurchased 8.0 million shares, or 6.2%, of its outstanding common stock at a price of $0.126 per share. The repurchase price of $0.126 per share is equal to 69% of shareholder's equity per share of $0.182 as of September 30, 2012. The Company currently has 121.4 million shares outstanding.
In a further effort to provide investors with additional information regarding the Company's results of operations, the Company is disclosing Adjusted EBITDA, which is computed as operating income before depreciation and amortization, corporate overhead at the holding company level and asset impairment charges. Adjusted EBITDA is a non-GAAP financial measure, defined as a numerical measure of financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles ("GAAP") in a company's statements of operations, balance sheets or statements of cash flows. Pursuant to the requirements of Regulation G, the Company provided a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure.
Although Adjusted EBITDA represents a non-GAAP financial measure, the Company considers Adjusted EBITDA to be a key operating metric of the Company's business which is used in its budgeting processes and to monitor and evaluate its financial and operating results. The Company believes that Adjusted EBITDA is useful to investors because it provides an analysis of financial and operating results using the same measure that the Company uses in evaluating itself. The Company believes that Adjusted EBITDA also provides stockholders and potential investors with a means to evaluate the Company's financial and operating results against other companies within the Company's industry. However, the Company's calculation of Adjusted EBITDA may not be consistent with the calculation of this measure by other companies in the Company's industry.
Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to 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 GAAP.
The following table reconciles operating income under GAAP (in thousands) (as reported in the Company's quarterly SEC filings) to Adjusted EBITDA for the three and nine months ended September 30, 2012 and 2011.
|Three months ended||Nine months ended|
|September 30,||September 30,|
|Operating Income||$ 360||$ 338||$ 1,469||$ 1,951|
|Add: Corporate overhead||301||327||1,144||907|
|Add: Amortization of intangible assets||387||401||1,172||1,238|
|Adjusted EBITDA||$ 1,048||$ 1,066||$ 3,785||$ 4,096|
Changes in Adjusted EBITDA for the three and nine months ended September 30, 2012 when compared to the three and nine months ended September 30, 2011 were most significantly impacted by the following items:
- During the three and nine months ended September 30, 2012, the Company experienced decrease in revenues as a result of a 2% decline in gross billings related to the core modeling business. This decline was somewhat offset by recognizing revenues during the nine months ended September 30, 2012, which were previously deferred, of approximately $716,000. The Company recognized the revenues as the result of an agreement with a former talent with respect to the modification of payment direction terms under various contracts negotiated by the Company between such talent, certain customers and, in some cases, the Company. In the absence of an agreement, the Company was scheduled to recognize approximately $385,000 of deferred revenues during the nine months ended September 30, 2012.
- During the three and nine months ended September 30, 2012, the Company paid compensation costs of approximately $168,000 and $515,000, respectively, in conjunction with certain non-compete and contractual arrangements of former employees. These costs were somewhat offset by a decline in travel related costs.
- Increases in office and general expenses also contributed to decreases in Adjusted EBITDA. Office and general expenses increased due to costs associated with contract employees, technology and leases associated with equipment and property. The Company continues to invest in technology and equipment to better deliver model management services to its talent.
On November 14, 2012, the Company's Wilhelmina Artist Management division, announced the representation of R&B/Pop "Pretty Girl," Keri Hilson, the award-winning singer, songwriter, actress, and philanthropist. The Wilhelmina team will explore and develop fashion and beauty endorsement, editorial and licensing opportunities for the 5'9" chart-topping beauty, who is currently recording her third studio album.
On November 15, 2012, the Company's Wilhelmina Artist Management division announced the representation of Chris Brown, the international, multi-platinum singer, songwriter, actor, and philanthropist. The Wilhelmina team will explore and develop fashion and beauty endorsement, editorial and licensing opportunities for the RCA Records, Grammy Award-winning entertainer, who has just received a People's Choice Awards 2013 nomination for "Favorite Male Artist" and is gearing up for his "Carpe Diem" world tour kicking off in Norway on November 17th.
Effective September 25, 2012, the Company appointed Alex Vaickus as the Company's Chief Executive Officer. Mr. Vaickus previously served as President of Playboy Enterprises Inc. ("PEI") from 2009 to 2011 and as President of PEI's Global Licensing Group from 2000 to 2011. Prior to that, Mr. Vaickus served as PEI's Vice President of Strategic Planning from 1998 to 2000. Under Mr. Vaickus' leadership, PEI's Global Licensing Group negotiated and signed more than 150 new license deals for a wide range of product categories, including apparel, accessories, jewelry, lingerie, fragrances and home textiles, and expanded the geographic presence of PEI's products from 50 countries to 180 countries representing nearly $1 billion in retail sales.
On October 24, 2012, the Company executed and closed the second amendment (the "Second Credit Agreement Amendment") to its revolving Credit Agreement with Amegy Bank. Included in the terms of the Second Credit Agreement Amendment, total availability under the revolving credit facility was increased to $5.0 million and the maturity date of the facility was extended to October 15, 2015. As of September 30, 2012, the Company had outstanding borrowings of $1,500,000 under the Credit Agreement. As of the date of this press release, the Company had outstanding borrowings of $1,250,000 under the Credit Agreement.
During August 2012, the Board of Directors authorized a stock repurchase program whereby the Company may repurchase up to 10,000,000 shares of its outstanding Common Stock. The shares may be repurchased from time-to-time in the open market or through privately negotiated transactions at prices the Company deems appropriate.
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 quarter ended September 30, 2012 which is expected to be filed November 20, 2012 with the Securities and Exchange Commission.
This report contains certain "forward-looking" statements as such term is defined in the Private Securities Litigation Reform Act of 1995 and information relating to the Company and its subsidiaries that are based on the beliefs of the Company's management as well as assumptions made by and 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 its subsidiaries or Company management, are intended to identify forward-looking statements. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including, without limitation, competitive factors, general economic conditions, the interest rate environment, governmental regulation and supervision, seasonality, changes in industry practices, one-time events and other factors described herein and in other filings made by the Company with the SEC. Based upon changing conditions, 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 intend to update these forward-looking statements.
About Wilhelmina International, Inc. and Wilhelmina Artist Management (www.wilhelmina.com):
Through Wilhelmina Models and its other subsidiaries including Wilhelmina Artist Management, Wilhelmina International, Inc. provides traditional, full-service fashion model and talent management services, specializing in the representation and management of leading models, entertainers, artists, athletes and other talent to various customers and clients including retailers, designers, advertising agencies and catalog companies. Wilhelmina Models was founded in 1967 by Wilhelmina Cooper, a renowned fashion model, and is one of the oldest and largest fashion model management companies in the world. Wilhelmina Models is headquartered in New York and, since its founding, has grown to include operations located in Los Angeles and Miami, as well as a growing network of licensees comprising leading modeling agencies in various local markets across the U.S. as well as in Panama, Thailand and Dubai.