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iMedia Brands, Inc. Reports First Quarter 2022 Results

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Imedia Brands Inc.
Imedia Brands Inc.

Q1 Net Sales were $155 Million, a 37% Increase Over the Prior Year Period

MINNEAPOLIS, May 24, 2022 (GLOBE NEWSWIRE) -- iMedia Brands, Inc. (“iMedia”) (NASDAQ: IMBI, IMBIL) today announced results for the first quarter ended April 30, 2022.

“We are off to good start this year,” said Tim Peterman, CEO of iMedia. “Our top three fiscal 2022 priorities continue to be to deliver positive earnings per share in the fourth quarter, strengthen our balance sheet, and capitalize on the convergence of entertainment, advertising and ecommerce.”

First Quarter 2022 Consolidated Highlights:

  • Net sales were $155 million, a 37% increase over the prior year period.

  • Gross margin was 39.7%, a 96 basis-point decline from the prior year period.

  • Net loss was $11.9 million or $(0.55) per common share, compared to $3.2 million or $(0.21) per common share in the prior year period. The Q1 2022 net loss included $2.5 million of transaction, settlement, and integration costs, compared to $.7 million of similar costs in the prior year period.

  • Adjusted EBITDA was $9.2 million, a 13% increase over the prior-year period.

  • Total 12-month rolling active customer count, as of April 30, 2022, grew by 48% compared to the prior-year period, driven by the continued strong customer growth from Christopher & Banks and from the addition of the 1-2-3.tv customer file.

Consolidated First Quarter 2022 Results (dollars in millions except EPS):

 

 

 

 

 

 

 

 

 

For the Three-Month Period Ended

 

 

April 30,
2022

 

May 1,
2021

 

Change

 

 

 

 

 

 

 

Net Sales

 

$

154.5

 

 

$

113.2

 

 

37

%

 

 

 

 

 

 

 

Gross Margin %

 

 

39.7

%

 

 

40.6

%

 

(96 bps)

 

 

 

 

 

 

 

Net loss attributable to non-controlling interest

 

$

(0.3

)

 

$

(0.2

)

 

(113

%)

 

 

 

 

 

 

 

Net loss attributable to shareholders

 

$

(11.9

)

 

$

(3.2

)

 

(269

%)

 

 

 

 

 

 

 

EPS

 

$

(0.55

)

 

$

(0.21

)

 

(162

%)

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

9.2

 

 

$

8.1

 

 

13

%

 

 

 

 

 

 

 

Segment First Quarter 2022 Highlights (dollars in millions): 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three-Month Period Ended

 

For the Three-Month Period Ended

 

 

 

 

April 30, 2022

 

May 1, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

 

 

 

 

 

 

Media

 

 

 

 

 

 

 

 

Consumer

 

Commerce

 

 

 

 

 

Consumer

 

Commerce

 

 

 

 

 

 

Entertainment

 

Brands

 

Services

 

Consolidated

 

Entertainment

 

Brands

 

Services

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

130.6

 

 

12.7

 

11.2

 

$

154.5

 

 

$

106.5

 

 

5.1

 

 

1.6

 

$

113.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

$

52.2

 

 

5.8

 

3.3

 

$

61.3

 

 

$

43.0

 

 

2.3

 

 

0.7

 

$

46.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

$

(9.2

)

 

1.8

 

0.8

 

$

(6.5

)

 

$

(1.5

)

 

(0.7

)

 

0.1

 

$

(2.1

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

4.8

 

 

2.5

 

1.9

 

$

9.2

 

 

$

7.6

 

 

0.3

 

 

0.2

 

$

8.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Entertainment & Consumer Brands Segments’ First Quarter 2022 Key Operating Metrics:

Entertainment + Consumer Brands

 

 

For the Three-Month Period Ended

 

 

April 30,

 

May 1,

 

 

 

Description

 

2022 (a)

 

2021

 

Change

 

 

 

 

 

 

 

 

Net Units (000s)

 

 

3,481

 

 

 

1,540

 

 

126

%

 

 

 

 

 

 

 

 

 

Average Selling Price (ASP)

 

$

37

 

 

$

65

 

 

(43

%)

 

 

 

 

 

 

 

 

 

Return Rate %

 

 

17.3

%

 

 

16.8

%

 

47 bps

 

 

 

 

 

 

 

 

 

Total Customers - 12 Month Rolling (000s)

 

 

1,584

 

 

 

1,072

 

 

48

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Entertainment + Consumer Brands

 

 

For the Three-Month Period Ended

 

 

April 30,

 

May 1,

 

 

 

% of Net Merchandise Sales by Category

2022 (a)

 

2021

 

Change

 

 

 

 

 

 

 

 

Jewelry & Watches

 

 

38

%

 

 

43

%

 

(545 bps)

 

 

 

 

 

 

 

 

 

Home & Consumer Electronics

 

 

18

%

 

 

14

%

 

450 bps

 

 

 

 

 

 

 

 

 

Beauty & Health

 

 

20

%

 

 

25

%

 

(519 bps)

 

 

 

 

 

 

 

 

 

Fashion & Accessories

 

 

24

%

 

 

18

%

 

614 bps

 

 

 

 

 

 

 

 

 

Total

 

 

100

%

 

 

100

%

 

 

 

 

 

 

 

 

 

 

 

(a) For the three-month periods ended April 30, 2022 and May 1, 2021, period-over-period comparison of the key operating metrics above are impacted by the addition of 1-2-3.tv in the period ended April 30, 2022, particularly the ASP metric because 1-2-3.tv’s ASP is below $25.

Liquidity and Capital Resources:

As of April 30, 2022, total unrestricted cash was $12.0 million. iMedia also had an additional $6.2 million of borrowing capacity available under its revolving credit facility.

Outlook:

For the second quarter of our fiscal year ending January 29, 2023 (“Fiscal 2022”), we anticipate reporting net sales of approximately $158 million, which is approximately 40% growth over the same prior year period. We anticipate reporting adjusted EBITDA of approximately $10 million, which is approximately a 11% increase over the same prior year period.

For Fiscal 2022, we reiterate our previously provided guidance. We anticipate reporting revenue of approximately $675 to $725 million, adjusted EBITDA of approximately $50 to $60 million and we anticipate reporting positive quarterly earnings per share beginning in the back half of Fiscal 2022, specifically in the fourth quarter.

A reconciliation of adjusted EBITDA is not available on a forward-looking basis without unreasonable efforts because we are unable to predict with reasonable certainty the ultimate outcome and timing of certain significant items, including mergers and acquisitions, other transactions, settlements, integration activities, customer concessions, restructuring activities, and certain tax related events. These items are uncertain, depend on various factors and could have a material impact on earnings and cash flow measures determined in accordance with U.S. generally accepted accounting principles (“GAAP”) for the applicable future period.

Conference Call:

Q1 2022 Earnings Conference Call: Our Q1 earnings conference call and webcast is scheduled for Tuesday, May 24, at 8:30 a.m. Eastern time to discuss our financial results for the first quarter ended April 30, 2022.

  • Date: Tuesday, May 24, 2022

  • Time: 8:30 a.m. Eastern time (7:30 a.m. Central time)

  • U.S. dial-in number: 1-877-407-9039

  • International dial-in number: 1-201-689-8470

  • Conference ID: 1372 9848

  • Webcast link: iMedia Brands 1Q earnings webcast

The conference call and webcast will be broadcast live and available for replay via the investor relations section of the iMedia Brands website at www.imediabrands.com.  A replay of the conference call will be available after 11:30 a.m. Eastern time on the same day through June 7, 2022.

  • Toll-free replay number: 1-844-512-2921

  • International replay number: 1-412-317-6671

  • Replay ID: 1372 9848

About iMedia Brands, Inc.

iMedia Brands, Inc. is a leading interactive media company capitalizing on the convergence of entertainment, ecommerce, and advertising. The company owns a growing, global portfolio of entertainment, consumer brands and media commerce services businesses that cross promote and exchange data with each other to optimize their consumer engagement experiences and to position the company as the leading single-source partner to television advertisers and consumer brands seeking to entertain and transact with customers. iMedia’s common stock is traded on the NASDAQ Global Market stock exchange under the ticker IMBI. iMedia’s 8.5% bonds are also publicly traded on the NASDAQ Global Market under the ticker IMBIL and pay holders 8.5% interest quarterly in arrears on March 31, June 30, September 30, and December 31.

Investors:
Ken Cooper
kcooper@imediabrands.com
(952) 943-6119

Media:
press@imediabrands.com
(952) 943-6125

 

iMEDIA BRANDS INC.

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands except share and per share data)

 

 

 

 

 

 

 

 

 

April 30,

 

January 29,

 

 

2022

 

2022

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash

 

$

12,049

 

 

$

11,295

 

Restricted Cash

 

 

1,893

 

 

 

1,893

 

Accounts receivable, net

 

 

76,166

 

 

 

78,947

 

Inventories

 

 

115,300

 

 

 

116,256

 

Current portion of television broadcast rights, net

 

 

24,723

 

 

 

27,521

 

Prepaid expenses and other

 

 

21,484

 

 

 

18,340

 

Total current assets

 

 

251,615

 

 

 

254,252

 

Property and equipment, net

 

 

47,405

 

 

 

48,225

 

Television broadcast rights, net

 

 

69,698

 

 

 

74,821

 

Goodwill

 

 

93,158

 

 

 

99,050

 

Intangible assets, net

 

 

28,725

 

 

 

27,940

 

Other assets

 

 

17,457

 

 

 

18,359

 

TOTAL ASSETS

 

$

508,058

 

 

$

522,647

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

85,666

 

 

$

89,046

 

Accrued liabilities

 

 

43,577

 

 

 

44,388

 

Current portion of television broadcast rights obligations

 

 

31,868

 

 

 

31,921

 

Current portion of long-term debt

 

 

14,400

 

 

 

14,031

 

Current portion of operating lease liabilities

 

 

1,764

 

 

 

2,331

 

Deferred revenue

 

 

633

 

 

 

427

 

Total current liabilities

 

 

177,908

 

 

 

182,144

 

Long term broadcast rights liability

 

 

77,114

 

 

 

81,268

 

Long-term debt, net

 

 

185,241

 

 

 

176,432

 

Long-term operating lease liabilities

 

 

4,877

 

 

 

5,169

 

Deferred tax liability

 

 

5,484

 

 

 

5,285

 

Other long term liabilities

 

 

3,787

 

 

 

2,986

 

Total liabilities

 

 

454,411

 

 

 

453,284

 

Commitments and contingencies

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Preferred stock, $0.01 per share par value, 400,000 shares authorized; zero shares issued and outstanding

 

 

 

 

 

 

Common stock, $0.01 per share par value, 29,600,000 shares authorized as of April 30, 2022 and January 29, 2022; 21,804,017 and 21,571,387 shares issued and outstanding as of April 30, 2022 and January 29, 2022

 

 

218

 

 

 

216

 

Additional paid-in capital

 

 

539,398

 

 

 

538,627

 

Accumulated Other Comprehensive Income/(loss)

 

 

(6,703

)

 

 

(2,428

)

Accumulated deficit

 

 

(481,359

)

 

 

(469,463

)

Total shareholders’ equity

 

 

51,554

 

 

 

66,951

 

Equity of the non-controlling interest

 

 

2,093

 

 

 

2,412

 

Total equity

 

 

53,647

 

 

 

69,363

 

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 

$

508,058

 

 

$

522,647

 

 

 

 

 

 

 

 



iMEDIA BRANDS, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three-Month Periods Ended

 

 

 

 

 

Apr 30,

 

 

May 1,

 

 

 

 

 

2022

 

 

2021

Net sales

 

$

154,544

 

 

 

$

113,203

 

Cost of sales

 

 

93,207

 

 

 

 

67,196

 

 

 

 

Gross profit

 

 

61,337

 

 

 

 

46,007

 

 

 

 

Margin %

 

 

39.7

%

 

 

 

40.6

%

Operating expense:

 

 

 

 

 

 

Distribution and selling

 

 

43,149

 

 

 

 

34,247

 

 

General and administrative

 

 

13,650

 

 

 

 

6,436

 

 

Depreciation and amortization

 

 

10,893

 

 

 

 

7,375

 

 

Restructuring costs

 

 

157

 

 

 

 

-

 

 

 

Total operating expense

 

 

67,850

 

 

 

 

48,058

 

Operating loss

 

 

(6,513

)

 

 

 

(2,051

)

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

Interest income and other

 

 

168

 

 

 

 

1

 

 

Interest expense

 

 

(5,854

)

 

 

 

(1,313

)

 

 

Total other expense

 

 

(5,686

)

 

 

 

(1,312

)

 

 

 

 

 

 

 

 

 

Loss before income taxes

 

 

(12,199

)

 

 

 

(3,363

)

 

 

 

 

 

 

 

 

 

Income tax (provision) benefit

 

 

(16

)

 

 

 

(15

)

 

 

 

 

 

 

 

 

 

Net loss

 

 

(12,215

)

 

 

 

(3,378

)

 

 

 

 

 

 

 

 

 

Less: Net loss attributable to non-controlling interest

 

(319

)

 

 

 

(150

)

 

 

 

 

 

 

 

 

 

Net loss attributable to shareholders

 

$

(11,896

)

 

 

$

(3,228

)

 

 

 

 

 

 

 

 

 

Net loss per common share

 

$

(0.55

)

 

 

$

(0.21

)

 

 

 

 

 

 

 

 

 

Net loss per common share

 

 

 

 

 

 

 

---assuming dilution

 

$

(0.55

)

 

 

$

(0.21

)

 

 

 

 

 

 

 

 

 

Weighted average number of

 

 

 

 

 

common shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

21,742,286

 

 

 

 

15,620,995

 

 

 

 

Diluted

 

 

21,742,286

 

 

 

 

15,620,995

 

 

 

 

 

 

 

 

 

 



IMEDIA BRANDS, INC.

AND SUBSIDIARIES

Reconciliation of Net Loss to Adjusted EBITDA

(Unaudited)

 

 

For the Three-Month Period Ended April 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

 

 

 

 

 

 

 

Consumer

 

Commerce

 

 

 

 

 

Entertainment

 

Brands

 

Services

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

 

 

 

 

 

 

 

 

 

$

(11,896

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and Amortization

 

 

 

 

 

 

 

 

 

 

 

11,731

 

Interest, net

 

 

 

 

 

 

 

 

 

 

 

4,369

 

Interest, Broadcast Rights Liability

 

 

 

 

 

 

 

 

 

 

 

1,317

 

Tax

 

 

 

 

 

 

 

 

 

 

 

16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA (as defined)

$

2,111

 

$

2,402

 

 

$

1,024

 

$

5,537

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A reconciliation of EBITDA to Adjusted EBITDA is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA (as defined)

$

2,111

 

$

2,402

 

 

$

1,024

 

$

5,537

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Transaction, Settlement and Integration costs, net (a)

 

1,500

 

 

100

 

 

 

909

 

 

2,509

 

Non-Cash Share-Based Compensation

 

985

 

 

-

 

 

 

-

 

 

985

 

Restructuring Costs

 

157

 

 

-

 

 

 

-

 

 

157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

4,753

 

$

2,502

 

 

$

1,933

 

$

9,188

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three-Month Period Ended May 1, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

 

 

 

 

 

 

 

Consumer

 

Commerce

 

 

 

 

 

Entertainment

 

Brands

 

Services

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

 

 

 

 

 

 

 

 

 

$

(3,228

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and Amortization

 

 

 

 

 

 

 

 

 

 

 

8,317

 

Interest, net

 

 

 

 

 

 

 

 

 

 

 

810

 

Interest, Broadcast Rights Liability

 

 

 

 

 

 

 

 

 

 

 

502

 

Tax

 

 

 

 

 

 

 

 

 

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA (as defined)

$

6,456

 

$

(234

)

 

$

194

 

$

6,416

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A reconciliation of EBITDA to Adjusted EBITDA is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA (as defined)

$

6,456

 

$

(234

)

 

$

194

 

$

6,416

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Transaction, Settlement and Integration costs, net (a)

 

701

 

 

-

 

 

 

-

 

 

701

 

Non-Cash Share-Based Compensation

 

678

 

 

-

 

 

 

-

 

 

678

 

One-time Customer Concessions

 

341

 

 

-

 

 

 

-

 

 

341

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

8,176

 

$

(234

)

 

$

194

 

$

8,136

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Transaction, settlement and integration costs for the three-month period ended April 30, 2022, includes transaction and integration costs related to our Christopher & Banks, Synacor and 1-2-3.tv transactions. For the three-month period ended May 1, 2021, includes transaction and integration costs related to the TheCloseOut.com and Christopher & Banks transactions.

Adjusted EBITDA

EBITDA represents net income (loss) for the respective periods excluding depreciation and amortization expense, interest income (expense) and income taxes. The Company defines adjusted EBITDA as EBITDA excluding non-operating gains (losses); executive and management transition costs; one-time customer concessions; restructuring costs; non-cash impairment charges and write downs; transaction, settlement, and integration costs, net; rebranding costs; and non-cash share-based compensation expense. The Company has included “adjusted EBITDA” in order to adequately assess the operating performance of its segments and in order to maintain comparability to analyst coverage and financial guidance, when given. Management believes that adjusted EBITDA allows investors to make a meaningful comparison between its business operating results over different periods of time and with those of other similar companies. In addition, management uses adjusted EBITDA as a metric to evaluate operating performance under the Company’s management and executive incentive compensation programs. EBITDA and adjusted EBITDA are both non-GAAP financial measures and should not be construed as an alternative to operating income (loss), net income (loss) or to cash flows from operating activities as determined in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be construed as measures of liquidity. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. A reconciliation of the comparable GAAP measure, net income (loss) to adjusted EBITDA is included in this release.

Cautionary Statement Concerning Forward-Looking Statements

This document may contain certain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact, including statements regarding future revenue and adjusted EBITDA are forward-looking. The Company often uses words such as anticipates, believes, estimates, expects, seeks, predicts, should, plans, will, or the negative of these terms and similar expressions to identify forward-looking statements, although not all forward looking-statements contain these words. These statements are based on management's current expectations and accordingly are subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained herein due to various important factors, including (but not limited to): variability in consumer preferences, shopping behaviors, spending and debt levels; the general economic and credit environment, including COVID-19; interest rates; seasonal variations in consumer purchasing activities; the ability to achieve the most effective product category mixes to maximize sales and margin objectives; competitive pressures on sales and sales promotions; pricing and gross sales margins; the level of cable and satellite distribution for the Company’s programming and the associated fees or estimated cost savings from contract renegotiations; the Company’s ability to establish and maintain acceptable commercial terms with third-party vendors and other third parties with whom the Company has contractual relationships, and to successfully manage key vendor and shipping relationships and develop key partnerships and proprietary and exclusive brands; the ability to manage operating expenses successfully and the Company’s working capital levels; the ability to remain compliant with the Company’s credit facilities covenants; customer acceptance of the Company’s branding strategy and its repositioning as a video commerce Company; the ability to respond to changes in consumer shopping patterns and preferences, and changes in technology and consumer viewing patterns; changes to the Company’s management and information systems infrastructure; challenges to the Company’s data and information security; changes in governmental or regulatory requirements; including without limitation, regulations of the Federal Communications Commission and Federal Trade Commission, and adverse outcomes from regulatory proceedings; litigation or governmental proceedings affecting the Company’s operations; significant events (including disasters, weather events or events attracting significant television coverage) that either cause an interruption of television coverage or that divert viewership from its programming; disruptions in the Company’s distribution of its network broadcast to customers; the Company’s ability to protect its intellectual property rights; the Company’s ability to obtain and retain key executives and employees; the Company’s ability to attract new customers and retain existing customers; changes in shipping costs; expenses related to the actions of activist or hostile shareholders; the Company’s ability to offer new or innovative products and customer acceptance of the same; changes in customer viewing habits of television programming; logistics costs including the price of gasoline and transportation; and the risks described from time to time in the Company’s reports filed with the SEC, including, but not limited to, the Company’s most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this announcement. The Company is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.