Hollywood Media Corp. Reports 2008 Fourth Quarter and Year-End Results

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BOCA RATON, FL--(MARKET WIRE)--Mar 16, 2009 -- Hollywood Media Corp. (NasdaqGS:HOLL - News), a leading provider of online ticketing services, today reported financial results for the fourth quarter and year ended December 31, 2008. Results reflect the divestment of the Company's Hollywood.com business in August 2008 and its Showtimes data business unit in August 2007, which have been accounted for as discontinued operations.

Recent Company Highlights:

 
--  Broadway Ticketing revenues of $27.9 million in the 2008 fourth
    quarter unchanged from fourth quarter 2007;
--  Positive 2008 fourth quarter and full-year EBITDA* performance for the
    Broadway Ticketing business;
--  Continued growth in high-margin advertising sales from Broadway shows;
--  Projected savings of approximately $3.0 million annually related to
    overhead cost reductions implemented in late 2008 and effective in the 2009
    first quarter, consisting of $2.4 million in headcount reductions at
    Hollywood Media's corporate headquarters and Broadway Ticketing segment and
    approximately $0.6 million in SG&A savings;
--  Strong performance from MovieTickets.com including a $1.9 million cash
    dividend paid to Hollywood Media in the 2009 first quarter; and
--  Cash at December 31, 2008 of $12.7 million with no debt, which
    included the repurchase during the 2008 fourth quarter of 1,711,639 shares
    of Hollywood Media's common stock for a total purchase price of $2.1
    million.

For the 2008 fourth quarter, Hollywood Media reported net revenues of $29.0 million compared to $29.6 million in the prior-year period. Broadway Ticketing revenues, which represented 96% of the Company's net revenues in the 2008 fourth quarter, were unchanged from the prior-year period at $27.9 million. Broadway Ticketing revenues in the 2008 fourth quarter were impacted by general economic conditions, however margin performance for the period benefited from an increase in advertising sales from Broadway shows, which are not recorded as revenues but rather as a reduction to cost of revenues-ticketing. The balance of Hollywood Media's revenues was attributable primarily to Ad Sales from the Company's U.K.-based CinemasOnline business which experienced a decline in the period of approximately $0.6 million.

The loss from continuing operations in the fourth quarter of 2008 was $6.3 million, or $0.20 per share, which includes a $3.5 million non-cash goodwill impairment charge related to the Ad Sales and Intellectual Properties segments. This compares to a loss from continuing operations in the prior-year period of $1.6 million, or $0.05 per share. For the full year, the Company reported a loss from continuing operations in 2008 of $10.6 million, or $0.33 per share, which includes the $3.5 million impairment charge mentioned above and $0.4 million of severance costs at Hollywood Media's corporate headquarters, versus a loss of $8.3 million, or $0.25 per share, in 2007.

Net loss for the 2008 fourth quarter was $6.6 million, or $0.21 per share, which includes the $3.5 million impairment charge and a loss from discontinued operations of $0.4 million, compared to a net loss of $1.9 million, or $0.06 per share, in the prior-year period which includes a loss from discontinued operations of $0.2 million. Net loss for 2008 was $16.9 million, or $0.53 per share, which includes the $3.5 million impairment charge and a loss from discontinued operations of $6.3 million, versus net income for 2007 of $1.7 million, or $0.05 per share, which includes income from discontinued operations of $10.0 million.

EBITDA (Modified)* loss in the 2008 fourth quarter was $5.6 million, which includes the $3.5 million impairment charge and compares to an EBITDA (Modified) loss of $1.4 million in fourth quarter 2007. For the full year, EBITDA (Modified) loss in 2008 was $8.8 million, which includes the $3.5 million impairment charge, and compares to an EBITDA (Modified) loss of $7.1 million in 2007.

The Broadway Ticketing segment generated EBITDA of $0.4 million in the 2008 fourth quarter compared to $0.9 million in the corresponding period of 2007. The fourth quarter 2008 EBITDA included $0.2 million in severance costs, $0.1 million in redundant lease expense, $0.2 million in website redesign costs, and a $0.4 million negative impact due to a change in gift certificate policy. Broadway Ticketing generated full year 2008 EBITDA of $3.4 million compared to $3.0 million in 2007. Broadway Ticketing's 2008 EBITDA included $0.2 million in severance costs, $0.3 million in redundant lease expense, $0.2 million in website redesign costs, and a $0.6 million negative impact due to a change in gift certificate policy.

"We are pleased that revenues for our Broadway Ticketing business in this challenging market environment were at comparable levels with the prior-year period," said Mitchell Rubenstein, CEO of Hollywood Media Corp. "During the fourth quarter, we continued to provide theatergoers with access to the most in-demand shows while managing our costs and inventory extremely well. At year-end, ticket insurance revenues more than offset unsold inventory.

"We also took steps in the fourth quarter to reduce our overhead costs which included additional headcount reductions, lowered general and administrative costs, and reduced occupancy costs. These expense reductions are expected to result in annualized savings of approximately $3.0 million with the full impact beginning in the first quarter of 2009."

Mr. Rubenstein concluded, "With a lower cost base and more focused portfolio of assets, along with profitable EBITDA performance anticipated for our Broadway business and dividends from our investment in MovieTickets.com, we look forward to improved operating performance in 2009."

At December 31, 2008, the Company had cash and cash equivalents of $12.7 million with no debt, compared to $14.3 million and no debt at September 30, 2008. During the 2008 fourth quarter, the Company repurchased 1,711,639 shares of its common stock for a total of $2.1 million. The cash position at December 31, 2008 does not include a $1.9 million cash dividend received by the Company in the first quarter of 2009 from its investment in MovieTickets.com in which Hollywood Media owns a 26.2% interest.

Teleconference Information

Management will host a teleconference to discuss Hollywood Media's 2008 fourth quarter and year-end financial results on Monday, March 16, 2009, at 10:00 a.m. Eastern Time. To access the teleconference, please dial 877-407-8293 (U.S.) or 201-689-8349 (international) approximately 10 minutes prior to the start of the call. The teleconference will also be available via live webcast on the investor relations portion of Hollywood Media's website, http://www.hollywoodmedia.com/conference_calls.htm.

If you are unable to listen to the live teleconference, a replay will be available through March 22, 2009, and can be accessed by dialing 877-660-6853 (U.S.) or 201-612-7415 (international). Callers will be prompted for replay account number 342# followed by conference ID number 316488#. An archived version of the webcast will also be available on the investor relations section of Hollywood Media's website at http://www.hollywoodmedia.com.

About Hollywood Media Corp.

Hollywood Media is a leading provider of online ticketing services, which include Broadway.com and Hollywood Media's minority interest in MovieTickets.com. Hollywood Media also owns the UK-based CinemasOnline and an Intellectual Property division. For more information, please visit the Company's corporate Web site, http://www.hollywoodmedia.com.

*Note on EBITDA

EBITDA and EBITDA (Modified) are non-GAAP financial measures. EBITDA is defined as net income before interest, taxes, depreciation and amortization. EBITDA (Modified) is defined as loss from continuing operations before interest, taxes, depreciation and amortization on continuing operations. Hollywood Media has presented EBITDA in this release because it considers such information an important supplemental measure which management utilizes as one of its tools in evaluating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation and comparison of companies in our industry as well as our results of operations from period to period. EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for Hollywood Media's financial results as reported under GAAP. Some of these limitations are: (a) EBITDA does not reflect changes in, or cash requirements for, Hollywood Media's working capital needs; (b) EBITDA does not reflect interest expense, or the cash requirements necessary to service interest or principal payments, if any; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and EBITDA does not reflect any cash requirements for such capital expenditures. Because of these limitations, EBITDA should not be considered as a principal indicator of Hollywood Media's performance. Hollywood Media compensates for these limitations by relying primarily on Hollywood Media's GAAP results and using EBITDA only supplementally. Hollywood Media has provided a reconciliation of net income to EBITDA (Modified) in the attached tables.

Note on Forward-Looking Statements

Statements in this press release may be "forward-looking statements" within the meaning of federal securities laws. The matters discussed herein that are forward-looking statements are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous potential risks and uncertainties, including, but not limited to, the need to manage our growth and integrate new businesses, our ability to realize anticipated revenues, cost efficiencies and sources of capital, the impact of potential future dispositions or other strategic transactions by Hollywood Media, our ability to develop and maintain strategic relationships, our ability to compete with other media, data and internet companies, technology risks, the volatility of our stock price, and other risks and factors described in Hollywood Media Corp.'s filings with the Securities and Exchange Commission including our Form 10-K for 2007 and, when filed, our Form 10-K for 2008. Such forward-looking statements speak only as of the date on which they are made, and Hollywood Media undertakes no obligation to publicly update or revise any forward-looking statement except as required by law.

 


                  HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS


                                                December 31,  December 31,
                                                    2008          2007
                                                ------------  ------------

                       ASSETS

CURRENT ASSETS:
  Cash and cash equivalents                     $ 12,685,946  $ 26,758,550
  Receivables, net                                 1,433,797     2,033,702
  Inventories held for sale                        4,491,841     3,950,578
  Deferred ticket costs                           12,085,237    16,481,861
  Prepaid expenses                                 1,418,563     2,167,109
  Other receivables                                1,431,216     3,877,167
  Other current assets                                99,945       629,298
  Restricted cash                                  2,600,000             -
  Current assets of discontinued operations                -     1,124,714
                                                ------------  ------------
    Total current assets                          36,246,545    57,022,979

PROPERTY AND EQUIPMENT, net                        4,649,202     4,486,620
INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED
 INVESTEES                                           132,800       286,985
INTANGIBLE ASSETS, net                               682,896     1,071,658
GOODWILL                                          25,154,292    29,049,259
OTHER ASSETS                                          73,126        54,993
LONG-TERM ASSETS OF DISCONTINUED OPERATIONS                -     2,006,342
                                                ------------  ------------
    TOTAL ASSETS                                $ 66,938,861  $ 93,978,836
                                                ============  ============

     LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                              $  1,374,661  $  3,380,403
  Accrued expenses and other                       3,708,652     4,403,088
  Deferred revenue                                15,196,455    21,433,825
  Gift certificate liability                       3,434,359     2,801,300
  Customer deposits                                  831,838     1,928,357
  Current portion of capital lease obligations       203,579       141,809
  Current portion of notes payable                    43,147        53,422
  Related party payable                            2,622,438             -
  Current liabilities of discontinued
   operations                                              -     2,719,289
                                                ------------  ------------
    Total current liabilities                     27,415,129    36,861,493

DEFERRED REVENUE                                     401,309       544,491
CAPITAL LEASE OBLIGATIONS, less current portion      203,901       255,971
OTHER DEFERRED LIABILITY                           1,168,096       616,413
NOTES PAYABLE, less current portion                   36,258        94,289
LONG-TERM LIABILITIES OF DISCONTINUED
 OPERATIONS                                                -         5,776

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
  Preferred stock, $.01 par value, 1,000,000
   shares authorized; none outstanding                     -             -
  Common stock, $.01 par value, 100,000,000
   shares authorized; 30,883,913 and 31,897,983
   shares issued and outstanding at December 31,
   2008 and December 31, 2007, respectively          308,839       318,980
  Additional paid-in capital                     309,100,760   310,120,531
  Accumulated deficit                           (271,695,431) (254,839,108)
                                                ------------  ------------
    Total shareholders' equity                    37,714,168    55,600,403
                                                ------------  ------------
    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY  $ 66,938,861  $ 93,978,836
                                                ============  ============



                  HOLLYWOOD MEDIA CORP. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS


                    TWELVE MONTHS ENDED             THREE MONTHS ENDED
                         DECEMBER 31,                   DECEMBER 31,
                ----------------------------  ----------------------------
                    2008           2007           2008           2007
                -------------  -------------  -------------  -------------
                                               (Unaudited)    (Unaudited)
NET REVENUES
  Ticketing     $ 110,918,969  $ 111,792,068  $  27,874,572  $  27,861,623
  Other             6,138,962      6,369,156      1,143,593      1,729,568
                -------------  -------------  -------------  -------------
                  117,057,931    118,161,224     29,018,165     29,591,191
                -------------  -------------  -------------  -------------


OPERATING COSTS
 AND EXPENSES
  Cost of
   revenues -
   ticketing       92,882,066     94,017,924     23,466,004     22,919,228
  Editorial,
   production,
   development
   and technology   3,323,546      3,590,192        638,488      1,005,477
  Selling, general
   and
   administrative  13,932,852     14,269,974      3,834,843      3,921,805
  Payroll and
   benefits        13,284,857     13,368,817      3,035,167      3,211,034
  Impairment loss   3,524,697              -      3,524,697              -
  Depreciation
   and
   amortization     2,224,831      1,378,492        773,472        364,070
                -------------  -------------  -------------  -------------

    Total
     operating
     costs and
     expenses     129,172,849    126,625,399     35,272,671     31,421,614
                -------------  -------------  -------------  -------------

    Loss from
     operations   (12,114,918)    (8,464,175)    (6,254,506)    (1,830,423)

EQUITY IN
 EARNINGS
 (LOSSES) OF
 UNCONSOLIDATED
 INVESTEES          1,160,623          4,747       (151,999)         2,686

OTHER INCOME
 (EXPENSE)
  Interest, net       425,251        199,437         33,147        286,895
  Other, net           44,958        (50,935)        85,231       (112,968)
                -------------  -------------  -------------  -------------

    Loss from
     continuing
     operations
     before
     minority
     interest     (10,484,086)    (8,310,926)    (6,288,127)    (1,653,810)

MINORITY
 INTEREST IN
 (INCOME)
 LOSSES OF
 SUBSIDIARIES         (81,365)         3,241         16,208         24,729
                -------------  -------------  -------------  -------------

    Loss from
     continuing
     operations   (10,565,451)    (8,307,685)    (6,271,919)    (1,629,081)

    Gain (loss)
     on sale of
     discontinued
     operations,
     net of income
     taxes         (4,655,122)    10,254,287       (351,405)       301,182
    Loss from
     discontinued
     operations    (1,635,750)      (211,993)             -       (531,308)
                -------------  -------------  -------------  -------------
    Income (loss)
     from
     discontinued
     operations    (6,290,872)    10,042,294       (351,405)      (230,126)

                -------------  -------------  -------------  -------------
    Net income
     (loss)     $ (16,856,323) $   1,734,609  $  (6,623,324) $  (1,859,207)
                =============  =============  =============  =============

Basic and
 diluted income
 (loss) per
 common share
    Continuing
     operations $       (0.33) $       (0.25) $       (0.20) $       (0.05)
    Discontinued
     operations         (0.20)          0.30          (0.01)         (0.01)
                -------------  -------------  -------------  -------------
    Total basic
     and diluted
     net income
     (loss) per
     share      $       (0.53) $        0.05  $       (0.21) $       (0.06)
                =============  =============  =============  =============

Weighted
 average common
 and common
 equivalent
 shares
 outstanding
 - basic and
 diluted           31,793,853     33,303,886     31,263,293     32,900,188
                =============  =============  =============  =============



                          Hollywood Media Corp.
         Segment Summary Financial Data and EBITDA Reconciliation


For the
 Year
 Ended
 December
 31, 2008

                                     Intellectual
              Broadway    Ad Sales   Properties
             Ticketing       (1)         (2)      Other (3)       Total
           ------------  ----------  ----------  -----------  ------------

Net
 Revenues  $110,918,969  $4,830,760  $1,308,202  $         -  $117,057,931

Operating
 Income
 (Loss)       2,533,682  (3,977,171)    (71,372) (10,600,057)  (12,114,918)

           ------------  ----------  ----------  -----------  ------------
Net Income
 (Loss)
 from
 continuing
 operations   2,600,393  (3,884,198)   (307,923)  (8,973,723)  (10,565,451)

  Add back
   (Income)
   Expense:

    Interest,
     net        (65,451)     11,652      (4,521)    (366,931)     (425,251)
    Taxes             -     (59,553)          7       60,499           953
    Depreci-
    ation and
    Amorti-
    zation      876,049     901,351         150      447,281     2,224,831

           ------------  ----------  ----------  -----------  ------------
EBITDA
 Income
 (Loss)
 from
 continuing
 opera-
 tions     $  3,410,991 $(3,030,748) $ (312,287) $(8,832,874) $ (8,764,918)
           ============  ==========  ==========  ===========  ============

For the
 Year Ended
 December
 31, 2007


              Broadway              Intellectual
             Ticketing    Ad Sales   Properties    Other (3)      Total
           ------------  ----------  ----------  -----------  ------------

Net
 Revenues  $111,792,068  $5,308,038  $1,061,118  $         -  $118,161,224

Operating
 Income
 (Loss)       2,652,352    (571,818)     (8,918) (10,535,791)   (8,464,175)

           ------------  ----------  ----------  -----------  ------------
Net Income
 (Loss)
 from
 continuing
 operations   2,691,261    (593,488)      8,499  (10,413,957)   (8,307,685)

  Add back
   (Income)
   Expense:

    Interest,
     net        (74,468)      6,439      (9,429)    (121,979)     (199,437)
    Taxes        (7,400)     26,839           -       26,968        46,407
    Depreci-
     ation and
     Amortiz-
     ation      351,310     553,237           -      473,945     1,378,492

           ------------  ----------  ----------  -----------  ------------
EBITDA
 Income
 (Loss)
 from
 continuing
 oper-
 ations    $  2,960,703  $   (6,973) $     (930)$(10,035,023) $ (7,082,223)
           ============  ==========  ==========  ===========  ============


For the
 Three
 Months
 Ended
 December
 31, 2008
 (unaudited)

                                    Intellectual
              Broadway    Ad Sales   Properties
             Ticketing      (1)         (2)       Other (3)       Total
           ------------  ----------  ----------  -----------  ------------

Net
 Revenues  $ 27,874,572  $  871,456  $  272,137  $         -  $ 29,018,165

Operating
 Income
 (Loss)         195,119  (3,660,118)   (282,472)  (2,507,035)   (6,254,506)

           ------------  ----------  ----------  -----------  ------------
Net Income
 (Loss)
 from
 continuing
 operations     203,848  (3,588,388)   (416,981)  (2,470,398)   (6,271,919)

  Add back
   (Income)
   Expense:

    Interest,
     net            829       1,787      (1,282)     (34,481)      (33,147)
    Taxes             -     (42,135)          -          690       (41,445)
    Depreci-
    ation and
    Amorti-
    zation      218,754     437,472          75      117,171       773,472

           ------------  ----------  ----------  -----------  ------------
EBITDA
 Income
 (Loss)
 from
 continuing
 oper-
 ations    $    423,431 $(3,191,264) $ (418,188) $(2,387,018) $ (5,573,039)
           ============  ==========  ==========  ===========  ============

For the
 Three
 Months
 Ended
 December
 31, 2007
(unaudited)

              Broadway               Intellectual
             Ticketing    Ad Sales   Properties   Other (3)      Total
           ------------  ----------  ----------  -----------  ------------

Net
 Revenues  $ 27,861,623  $1,465,493  $  264,075  $         -  $ 29,591,191

Operating
 Income
 (Loss)         843,598    (156,079)    (50,269)  (2,467,673)   (1,830,423)

           ------------  ----------  ----------  -----------  ------------
Net Income
 (Loss)
 from
 continuing
 operations     859,980    (232,364)    (20,558)  (2,236,139)   (1,629,081)

  Add back
   (Income)
   Expense:

    Interest,
     net        (26,051)      3,130      (2,296)    (261,678)     (286,895)
    Taxes             -      82,728           -       26,233       108,961
    Depreci-
     ation and
     Amorti-
     zation      85,159     158,688           -      120,223       364,070

           ------------  ----------  ----------  -----------  ------------
EBITDA
 Income
 (Loss)
 from
 continuing
 opera-
 tions     $    919,088  $   12,182  $  (22,854) $(2,351,361) $ (1,442,945)
           ============  ==========  ==========  ===========  ============

(1)  The Ad Sales segment includes a $3.3 million non-cash impairment
     charge in the fourth quarter of 2008 related to the UK-based
     CinemasOnline business.
(2)  The Intellectual Properties segment includes a $0.2 million non-cash
     impairment charge in the fourth quarter of 2008.
(3)  The Other segment is comprised of payroll and benefits for corporate
     and administrative personnel as well as other corporate-wide expenses
     such as legal fees, audit fees, proxy costs, insurance, centralized
     information technology, and includes consulting fees and other fees
     and costs relating to compliance with the provisions of the Sarbanes-
     Oxley Act of 2002 that require Hollywood Media and its Independent
     Registered Public Accounting Firm to make an assessment of and report
     on internal control over financial reporting.