Dolphin Entertainment FY 2022 Revenue Increases 13% to a Record $40.5 Million

MIAMI, FL / ACCESSWIRE / March 30, 2023 / Dolphin Entertainment, Inc. (NASDAQ:DLPN), a leading entertainment marketing and premium content production company, announces its financial results for the fourth quarter and full year ended December 31, 2022.

Bill O'Dowd, CEO of Dolphin Entertainment, commented, "2022 was a great year, and we expect 2023 to be even better. In 2022, we reached our stated operational goal, exceeding $40 million in revenue. We also grew our entertainment marketing Super Group with the acquisition of influencer powerhouse Socialyte in Q4. And, finally, we enjoyed our first full year of Dolphin 2.0 ventures, highlighted by entering into production on "The Blue Angels," the first project under our partnership with IMAX for feature documentaries that was announced at the Cannes Film Festival, and by the soft opening of Midnight Theatre later in the year.

Mr. O'Dowd continued, "Moving ahead in 2023, we anticipate completing our marketing Super Group with the acquisition of a live events production company. We also expect to begin to recognize revenues from our current Dolphin 2.0 ventures, including The Blue Angels which is expected to be released in the second half of this year. With the hiring of Fortune 500 industry veteran Ellie Doty as our Chief Marketing Officer, announced earlier today, we now have the leadership in place for the selection and execution of an increased cadence of new Dolphin 2.0 ventures that compensate Dolphin in both cash fees and equity upside."

2022 and Recent Highlights

  • Total Q4 2022 revenue increased 6% to a record $11.1 million; full year 2022 revenue increased 13% to a record $40.5 million.
  • Operating loss for the year ended December 31, 2022, of $4.6 million includes non-cash items from depreciation and amortization of $1.8 million, impairment of goodwill of $0.9 million, gain on the change in fair value of contingent consideration of $47,285, and non-recurring costs of (i) $0.5 million related to acquisition costs and (ii) legal and professional fees of approximately $0.6 million related to the restatement of our financial statements of the 3rd quarter of 2021, change of audit firm, financing arrangement with Lincoln Park Capital LLC and filing of our Form S-1. This compares to an operating loss for the year ended December 31, 2021 of $5.5 million, which includes non-cash items from depreciation and amortization of $1.9 million and losses in the change of fair value of contingent consideration of $3.7 million.
  • Net loss for the year ended December 31, 2022 of $4.7 million includes non-cash items from depreciation and amortization of $1.8 million, impairment of good will of $0.9 million, gain on the change in fair value of contingent consideration of $47,285, non-recurring costs of (i) $0.5 million related to acquisition costs; (ii) legal and professional fees of approximately $0.6 million related to the restatement of our financial statements of the 3rd quarter 2021, change of audit firm, financing arrangement with Lincoln Park Capital LLC and filing of our Form S-1 and (iii) gains in the changes of fair value of certain liabilities in the amount of $0.8 million. This compares to net loss for the year ended December 31, 2021 of $6.5 million which included non-cash items from depreciation and amortization of $1.9 million, losses of $3.7 million from changes in the fair value of contingent consideration and losses of $3.1 million from changes in the fair value of certain liabilities offset by a gain on the forgiveness of the Paycheck Protection Program loans of approximately $3.0 million.
  • Unrestricted cash and cash equivalents of $6.1 million as of December 31, 2022 as compared to $7.7 million as of December 31, 2021.
  • Announced industry veteran Ellie Doty has been hired as Chief Marketing Officer responsible for branding, messaging and communications for Dolphin to all audiences and stakeholders.
  • Acquired East Coast influencer marketing agency Socialyte. Together, Be Social + Socialyte represent over 200 leading creator talent with hundreds of millions of followers on social media and creates an unrivalled bi-coastal combination within the influencer marketing industry.
  • 42West's work on the "Top Gun: Maverick" campaign resulted in an Academy Award for Best Sound and six Oscar nominations; follows worldwide box office 2022 total of $1.49 billion, the biggest of client Tom Cruise's career to date.
  • Shore Fire artists earned fourteen awards at 2023 GRAMMYs, including Song of the Year and Best New Artist, after a record forty-three nominations.
  • IMAX Corporation and Dolphin Entertainment greenlit their first project, Blue Angels, since entering into a multi-year agreement to jointly finance the development and production of a slate of feature-length documentaries for the global market. Blue Angels, co-produced with JJ Abrams, Bad Robot Productions and Zipper Bros Films is currently in production, and is scheduled for a H2 2023 release.
  • Dolphin Entertainment's flagship NFT collection, Creature Chronicles, sells out in 90 Minutes
  • Midnight Theatre held soft opening and partnered with Mastercard as presenting sponsor.
  • Pan-Asian restaurant Hidden Leaf (at The Midnight Theatre in Manhattan West) opened.
  • Dolphin Entertainment managed all aspects of publicity and marketing for Midnight Theatre and Hidden Leaf, and facilitated talent and commercial relationships within the entertainment and culinary industries - Dolphin holds a meaningful ownership stake in the venture.

Conference Call Information
To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.

Date: Thursday, March 30
Time: 4:30pm ET
Toll Free: 888-506-0062; International: 973-528-0011
Participant Access Code: 582219
Webcast: https://www.webcaster4.com/Webcast/Page/2225/47858

Replay:
Toll Free: 877-481-4010; International: 919-882-2331
Replay Passcode: 47858
Webcast Replay https://www.webcaster4.com/Webcast/Page/2225/47858

About Dolphin Entertainment, Inc.
Dolphin Entertainment is a leading independent entertainment marketing and production company. Through our subsidiaries 42West, The Door, Shore Fire Media and B/HI (a division of 42West), we provide expert strategic marketing and publicity services to many of the top brands, both individual and corporate, in the film, television, music, gaming and hospitality industries. All three PR firms have been ranked among the most recent Observer's "Power 50" PR Firms in the United States. Viewpoint Creative, Be Social and Socialyte complement their efforts with full-service creative branding and production capabilities as well as social media and influencer marketing services. Dolphin's legacy content production business, founded by Emmy-nominated CEO Bill O'Dowd, has produced multiple feature films and award-winning digital series, and has recently entered into a multi-year agreement with IMAX to co-produce feature documentaries. To learn more, visit: https://www.dolphinentertainment.com

This press release contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, Dolphin Entertainment Inc.'s offering of common stock as well as expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by the use of words such as "will," "would," "anticipate," "expect," "believe," "designed," "plan," or "intend," the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, Dolphin Entertainment's actual results may differ materially from the results discussed in its forward-looking statements. Dolphin Entertainment's forward-looking statements contained herein speak only as of the date of this press release. Factors or events Dolphin Entertainment cannot predict, including those described in the risk factors contained in its filings with the Securities and Exchange Commission, may cause its actual results to differ from those expressed in forward-looking statements. Although Dolphin Entertainment believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved, and Dolphin Entertainment undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

CONTACT:
James Carbonara/Hayden IR
(646)-755-7412
james@haydenir.com

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations

Twelve months ended December 31,
2022 2021
Revenues
$ 40,505,558 $ 35,727,199
Expenses:
Direct costs
3,566,336 3,879,409
Payroll and benefits
28,947,730 23,819,327
Selling, general and administrative
6,572,020 5,836,235
Acquisition costs
480,939 22,907
Impairment of goodwill
906,337 -
Change in fair value of contingent consideration
(47,285 ) 3,754,221
Depreciation and amortization
1,751,211 1,905,354
Legal and professional
2,903,412 2,013,436
Total expenses
45,080,700 41,230,889
Loss from operations
(4,575,142 ) (5,503,690 )
Other income (expenses):
Gain on extinguishment of debt
- 2,988,779
Change in fair value of convertible notes
654,579 (570,844 )
Change in fair value of warrants
120,000 (2,482,877 )
Change in fair value of put rights
- (71,106 )
Interest expense
(555,802 ) (785,209 )
Total other income (expenses), net
218,777 (921,257 )
Loss before income taxes and equity in losses of unconsolidated affiliates
(4,356,365 ) (6,424,947 )
Income tax expense
(176,981 ) (37,356 )
Net loss before equity in losses of unconsolidated affilates
(4,533,346 ) (6,462,303 )
Equty in losses of unconsolidated affiliates
(246,789 ) -
Net loss
$ (4,780,135 ) $ (6,462,303 )
(Loss) earnings per share - Basic
$ (0.49 ) $ (0.85 )
(Loss) earnings per share - Basic
$ (0.56 ) $ (0.85 )
Weighted average number of shares used in per share calculation
Basic
9,799,021 7,614,774
Diluted
9,926,926 7,614,774

DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets

ASSETS
As of December 31, 2022 As of December 31, 2021
Current
Cash and cash equivalents
$ 6,069,889 $ 7,688,743
Restricted cash
1,127,960 541,883
Accounts receivable
Trade, net of allowance of $736,820 and $627,553, respectively
7,921,380 4,513,179
Other receivable
3,794,085 3,583,357
Notes receivable
4,426,700 1,510,137
Other current assets
523,812 450,060
Total current assets
23,863,826 18,287,359
Capitalized production costs, net
1,598,412 137,235
Employee receivable
604,085 366,085
Right-of-use asset
7,341,045 6,129,411
Goodwill
29,314,083 20,021,357
Intangible assets, net
9,884,336 6,142,067
Property, equipment and leasehold improvements, net
293,206 473,662
Other long term assets
2,477,839 1,234,275
Total Assets
$ 75,376,832 $ 52,791,451
LIABILITIES
Current
Accounts payable
$ 4,798,221 $ 942,085
Term loan, current portion
408,905 -
Notes payable, current portion
3,868,960 307,685
Contingent consideration
500,000 600,000
Accrued interest - related party
1,744,723 1,621,437
Accrued compensation - related party
2,625,000 2,625,000
Lease liability, current portion
2,073,547 1,600,107
Deferred revenue
1,641,459 406,373
Other current liabilities
7,626,836 6,850,584
Total current liabilities
25,287,651 14,953,271
Noncurrent
Term loan, noncurrent portion
2,458,687 -
Notes payable, noncurrent portion
500,000 868,959
Convertible notes payable
5,050,000 2,900,000
Convertible notes payable at fair value
343,556 998,135
Loan from related party
1,107,873 1,107,873
Contingent consideration
238,821 3,684,221
Lease liability
6,012,049 5,132,895
Deferred tax liability
253,188 76,207
Warrant liability
15,000 135,000
Other noncurrent liabilities
18,915 -
Total Liabilities
41,285,740 29,856,561
STOCKHOLDERS' EQUITY
Preferred Stock, Series C, $0.001 par value, 50,000 authorized, issued and outstanding at December 31, 2022 and 2021.
1,000 1,000
Common stock, $0.015 par value, 200,000,000 shares authorized, 12,340,664 and 8,020,381 shares issued and outstanding at December 31, 2022 and 2021 , respectively.
185,110 120,306
Additional paid in capital
143,119,461 127,247,928
Accumulated deficit
(109,214,479 ) (104,434,344 )
Total Stockholders' Equity
$ 34,091,092 $ 22,934,890
Total Liabilities and Stockholders' Equity
$ 75,376,832 $ 52,791,451

SOURCE: Dolphin Entertainment



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