Q4 2023 Dolphin Entertainment Inc Earnings Call
Participants
James Carbonara; IR; Hayden IR
Bill O'Dowd; President & CEO; Dolphin Entertainment, Inc.
Mirta Negrini; CFO & COO; Dolphin Entertainment, Inc.
Allen Klee; Analyst; Maxim Group, LLC
Presentation
Operator
Greetings. Welcome to the Dolphin Entertainment Fourth Quarter 2023 earnings call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation if anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, James Carbonara of Hayden IR. You may begin.
James Carbonara
Thank you, operator. With me on the call are Bill O'Dowd, Chief Executive Officer, and Mirta Negrini, Chief Financial Officer. I'd like to begin the call by reading the Safe Harbor statement. Please note that statements made on this call are not historical facts, excuse me, that are not historical facts may be forward-looking statements. Significant risks and uncertainties that could cause actual results to differ from those expressed or implied in the forward-looking statements are detailed in the Company's annual report on Form 10-K and supplemented by subsequently filed quarterly reports on Form 10-Q as well as in other reports that the company has filed with the SEC. Any forward-looking statements made on this call are made only as of today's date, and the Company does not undertake any obligation to update or supplement any such statements to reflect subsequent developments.
Now I would like to turn the call over to Bill O'Dowd, CEO of Dolphin Entertainment. Bill, Please proceed.
Bill O'Dowd
Thanks, James. That was the shortest Safe Harbor statement you have ever read in your career. I know people are hoping you'll come back at the end of the call.
Hi, everyone. Good afternoon. Thank you for joining us today. As always, we'll start with a review of some financial and operating highlights, followed by a full financial review and then open it up for Q&A.
So from a financial highlights perspective, revenue for Q4 was a record $12 million quarterly revenue record for Dolphin Entertainment, an increase of 8% year over year. I'm immensely proud of the Dolphin team managed to achieve its best revenue quarter ever despite enduring to prolonged industry-wide strikes and even more impressively on the bottom line, the team delivered positive adjusted operating income of $300,000 in the face of such headwinds. This is very important to note. So I'm going to pause here and add that adjusted operating income is the primary metric by which we measure our business is what I look at first and any P and L I receive from Narita, we define adjusted operating income as our operating income or loss after removing any non-cash or nonrecurring income or expenses. In other words, if you go to our reported operating income or loss and backout all non-cash and nonrecurring items. How did we do reporting positive adjusted operating income is extremely gratifying, obviously, and now that we have our Super Group complete with the acquisition of special projects. And with our expectation of continued synergies and organic growth, combined with the launch of our ventures in earnest, we believe that we will continue to have and expand positive adjusted operating income on a continuous annual basis. It's very exciting and it's good to share with everyone how we look at our business and the metric, even if it's a non-GAAP metric that we use some speaking of special projects, I know we discussed the acquisition at length on our Q3 call, but the Transics that excuse me, the transaction did happen in Q4. So just a couple of more bullets on them.
As a brief refresher, I'll just point out the special projects founded by the amazing industry leaders, Nicole, that your alley and Andrea Oliveira as a leading agency in talent booking and celebrity curated event production with offices in Los Angeles and New York, their impressive client roster includes top brands like Apple, Chanel, Condé Nast Wall Street Journal among many, many others. With this strategic addition to often aims to launch or partner on our own live events as well as capitalize on cross-selling opportunities and synergies across our various companies and speaking of our other companies.
I'll now turn to some operating highlights. 42 West help clients secure four wins at the 96 Academy Awards and received two dozen nominations while boosting global interest for the boiling the Herring and Godzilla minus one, I'm going to go off-script for a second because I just got to give a public round of applause to the 42 U.S. movie promotion team deploying the Heron was a tremendous achievement to win an Oscar for in the animated motion picture category, I don't know if that's the first time that a or must be one of the first times that a movie that was an American one that category to beat us Spider-Man animated movie was a real achievement. Congratulations that 42 U.S. team and a separate team was promoting Godzilla minus one on best visual effects Oscars, what they want for that entire movie at a budget of $15 million. And I think every maybe they are competing against head of visual effects budget, a bigger than $15 million. Tremendous job getting the academy to see the movie and promoting the highlights of the visual effects between Q3.
So great job. 42, moving to Shore Fire Shore Fire which also continuously does great lead PR work representing clients who collectively received nine Grammy Awards in over two dozen nominations across various categories, showcasing its rosters, diversity in multiple genres and major industry events that recognized both film and music. Each of 42 West and Shore Fire Media regularly represent their clients. This was evident in Q4 and year to date with both agencies orchestrating over half a dozen PR campaigns for clients at the 2024 South by Southwest Film Festival a couple of weeks ago, and they also achieved notable success at 81st Golden Globes contributing to clients securing multiple awards and receiving over 1,000 nominations. Love it when Star agencies work together and have success at award shows like that the door. Switching to them celebrated eight consecutive years representing the Food Network, New York City Wine and Food Festival presented by Capital One. Additionally, they added new client geography from geography to Lawrence's for an Emmy award, winning our television personality and New York Times best-selling cookbook author. What does she do restaurant tour entrepreneur? They added GSC and yada to its growing roster of elite culinary clients in lifestyle brands, special shout out to Charlie, most will come up on this, call.
Okay. Now let's talk about the digital department. I pointed out in our letter to shareholders in January that this will be the subsidiary of focus for expansion during the next few quarters. At least, we believe that there is such an opportunity in the marketplace to establish the first fully scaled influencer management company with the ability to service brands and creators of all age groups on all major social media platforms. And in a variety of specialties. To that end, we had two major announcements in Q1. First, the digital department brought in the influencer roster of glo lab to introduce a specialized talent management division catering to skin care experts and dermatologists led by glow Lab's Founder, Susan Yara. Susan is an extremely successful skincare influencer herself with our own YouTube channel, and she is also founder of materials, a skincare product line, which was sold for the low low price of $355 million to health beauty in September 2023. I point that out because part of the strategy of inviting Susan and her roster to join the digital department to help us conceive and develop partnerships to launch skincare products in which we have an ownership stake. Obviously, Susan had a very successful exit ourself in just over three years. In other words, in Ternium launched in June of 2020 June of 2020 and was sold in September of 2023 for [$355 million].
Now it's also worth mentioning that materials marketing during those three years was almost exclusively influencer marketing and PR, both of which are obviously strengths at Dolphin. I'll dispel any myth. We did not enter into the agreement with Susan to put James Carbonara as the face of a new skincare product line, but we are excited to launch skincare products in addition to bringing global lead.
The digital department also established a young adult division, a YA. division as we call it in partnership with the U.S. bring agency. This was also a highly strategic move for us. You probably saw the announcement in February. Glow lab was back in January and immediately enhances our reach across TikTok and YouTube to complement our current strength on Instagram. And it launches an entirely new age group of influencers for us, 10s and young adults. We did so in partnership with the offspring agency, which is Hollywood's premier talent agency for that age group, Cindy Brink, someone I'm proud to call a friend, the founder of the offspring agency is nothing short of a legend, having launched a careers of hundreds of young actors over the past 25 plus years, including Dakota and Elle fanning and literally dozens of lead actors across Nickelodeon, Disney Channel and feature film. Unlike 25 years ago or even more recently when we were producing movies and series for Nickelodeon, there is now a thing called social media. I'm joking, of course, I'm sure you've heard of it. And so many of those same talented teenagers and young adults have today have TikTok feeds and YouTube channels of their own. Simply put, we want to represent them and we want to introduce them to brands. And by partnering with us Brink agency, we just saved years of development time for that division and went from 0 to 60, maybe even to 100 in the snap of our fingers. We announced the partnership, as I said last month, and we already have more than three dozen of these young, talented social media stars on our roster. And we can't wait to introduce them to our existing brand partners and to new brand partners we will meet, we will want to reach this important demographic viewpoint, creative announced an extensive partnership with the Massachusetts State Lottery specializing in digital graphic design and animation services, and they also received congrats, Dave and the team for Music Awards for extraordinary craft chefs, compelling narratives and leaves a lasting impact on audiences. And finally, special projects hit the ground running at Dolphin, partnering with the Academy Museum of motion pictures for its third annual gala and continued collaborations with The Wall Street Journal magazines innovator awards, great job booking tried as Kelsey again, and his talent booking partner and entertainment consultant for Town & Country's annual philanthropy summits, which I attended, by the way, go in our script again, and a special shout out to Charlie's there and the great work she is doing Internet of South Africa.
It was very impressive. They also collaborated with Chanel, Gucci and Valentino on their respective boutique openings and events during New York Fashion Week in February as well as an entire slate of events during Oscar week, which we'll highlight on our Q1 earnings call in six weeks, we got to say something, right. Shifting gears, I'll provide updates on some of our ventures in which Dolphin and its shareholders participate. So I'm going to turn first to Blue Angel because what a week for that, right. As some may recall, Dolphin entered into a multi-year agreement to jointly finance the development and production of a slate of feature length documentaries for the global market the first project greenlit was the Blue Angels Capone. We announced that a couple of years ago at Con Film Festival developed and co-produced by JJ Abrams and his company Bad Robot productions and cleanse it burners company, zipper Brothers films. We then announced that Amazon Studios had acquired worldwide worldwide rights to the Blue Angels, wherein we expected to generate approximately $3.75 million to often from the acquisition agreement, which would result in a 75% ROI. before the inclusion of any revenues to Dalton from the ticket sales from Eimac institutional theaters, providing powerful validation for our model of also taking equity in projects we market. We're very excited for this, so it has turned out great. And so our partners. Amazon secured an exclusive trailer Debut and promotion on The Today Show last Wednesday. Thank you.
Our partners and Amazon very well reviewed clip that is extremely dead. That type of promotion by the way for those curious, that is extremely rare for a documentary. I just ask any of you. When was the last time you saw a trailer drop for documentary on a morning show when you remember, please please let me know and let me tell you that trailer has been a hit over 1.7 million views occurred in the first, 24 hours. And as of today, week later for over 9 million views, I believe this has to be one of the highest totals, if not the highest total for documentary feature in the 28 years.
I've been in this business. And of course, this does not count the number of times the trailer has been viewed ahead of movies and theaters. I. MX has placed a trailer at Ghostbusters in many locations this past week, and it will be ahead of the Godzilla King Kong movie that premieres tonight in many locations across the country as well. This precedes the beginning of an exclusive run in IMAX theaters starting May 17. What do you do in May 17? I hope you go into the movie theater, seen Blue Angels a Friday. You'll love it with availability for streaming on Prime Video beginning May 23, right ahead of Memorial Day weekend. Our success with Blue Angels is the result of a deliberate strategy to create event documentaries on subject matters you want to see in IMAX theaters, putting an IMAX camera and a fighter jet cockpit and literally seeing the neighboring jet only 12 inches away. I cannot describe it fingers crossed. We think we have something special and the importance of a theatrical release and enhancing its films value for streaming platforms cannot be overstated given the pre-established audience awareness. A theatrical release provides our deal with RE/MAX is significant for two main reasons. Firstly, it laid the groundwork for the robust streaming sale, which has been extraordinary.
Secondly, there's an annuity benefit due to IMAX's ownership of theaters and museums and generally institutional theaters. As we call it, we are eligible to showcase our film in IMAX institutional theaters six months after it premieres on Amazon. This means that as of November 23rd, the film can be presented at the Smithsonian aviation museum and an additional 150 theaters across America. This arrangement creates a steady income stream, an annuity, which is quite remarkable. I wanted to make sure everyone understands the significance of it.
So in terms of financials, we retain a high percentage of ticket sales, roughly 25% since there's no distributor involved, for instance, in a theater with 200 seats of each ticket sold at $10. That's $2,000 in revenue from which we would earn $500. That's just from one showing in one theater and there are 150 theaters in the country, 365 days in here. So considering the film's potential to run for part of or the entire year in various museums. This is expected to continue for the next decade or two to come, given the scarcity of this type of content in institutional venues.
Furthermore, with the version of the film being shown in institutional theaters being only 44 minutes long versus the normal 90 minutes, and that will have on our May 17th and traditional theaters we can put in more showings per day. These details are crucial for stakeholders to understand the financial implications. You may you might ask what's the value of the movie institutional theaters and whilst challenging to specify an exact figure. We anticipate this could generate hundreds of thousands of dollars annually, if not more contributing directly to the bottom line since the film has already recouped its investments. So in addition to the 75% ROI from the from the streaming sale and our participation in ticket sales from the initial theatrical run beginning May 17.
We also gain this annuity post streaming around beginning in November. Very excited for Blue Angels. And if you haven't seen the trailer yet, I hope you get a chance to check it out online, right now switching gig switching gears excuse me to MasterCard in the night theater for those unfamiliar MasterCard midnight theaters, the state of the art contemporary variety theater and restaurant experience in the heart of Manhattan neighborhood dubbed Manhattan West. So often as the managing member and the venue and is responsible for the marketing of both the theater and the accompanying restaurant. We have a meaningful ownership stake in MasterCard, midnight theater as well. And it's been very gratifying to see the venue attracting high-profile events and partnerships with major brands like MasterCard, the star-studded premieres with Jessica Chastain Davidson. Keenly cocoa and Kevin Grant showcased the theaters ability to draw top talent and create exciting synergies with our PR firm. However, since our grand opening last September, and especially in the typically slower Q1 period. Operations across the restaurant cafe downstairs on the theater have not met our expectations and is well understood that without a profitable restaurant is challenging to make the venue successful. So we have prioritized our search for a new operator with a new restaurant concept that can best attempt to revitalize that space going into the key summer and fall seasons. While there's no assurance that any deal will close, we have identified the group that we would like to bring in and we are working hard to close a deal in the next few weeks, acknowledging the challenges of past six months and facing the uncertainty brought about by this potential change or whether we can make a change at all, we decided to impair the asset value we had on our books, viewing it as an opportunity to reset and potentially avoid future financial overhang.
Turning to our newest venture, we are proud to share that Dolphin Entertainment has partnered with renowned culinary personality and client. Rachael Ray and the esteemed do good spirits distillery to launch staple gin. This collaboration brings together Rachel's culinary expertise to do good spirits, craftsmanship and Dalton's marketing prowess to create a unique and promising addition to the spirits market stable June as a result of resource passion for creating flavorful experiences and our decades of culinary knowledge, the botanical recipe developed by Rachel ourself promises a balanced intriguing flavor profile that reflects Rachael Signature Style, our subsidiary, the door which has represented Rachael Ray since 2008. And Charlie and Lowe's have worked with her since 2005 have been instrumental in bringing this project to life the doors team has leveraged their extensive experience in marketing, wine, spirits and consumer packaged goods as well as their long-standing relationships with culinary personalities and restaurants to contribute to all stages of staple gins developed from branding to marketing, PR and trade relations. The door has played a crucial role in positioning stable gin for success to generate buzz and anticipation for the launch staple gen made its first public debut at two prestigious events, the New York City Wine and Food Festival and the South Beach wine and food Cecile, Rachael Ray herself was present at these events 0.6 for attendees, while do good spirits mixed up a staple gin cocktails, the response from those who had the opportunity to taste a project has been overwhelmingly positive, further validating our confidence in this new venture. People join us that come to market here in Q2, initially in New York State at bars, restaurants and retail destinations with plans to expand to additional markets in the future. We are thrilled to be part of this collaboration and to utilize the full range of marketing and PR capabilities that Dolphin Entertainment offers. We believe that stable gin has the potential to become a staple No pun intended to easy right in home bars and a go-to choice for classic cocktails like the gin and tonic or perfect Martini. We are incredibly excited about the potential of staple gin and our partnership with Rachael Ray, just absolutely lovely. As you may know, celebrity back spirits brands have seen tremendous success in recent years. Just look at the example of Ryan Reynolds is aviation gin exit of more than $0.5 billion, and George Clooney tequila brand, which sold for $1 billion. Moreover, it was reported last month at the potential value between The Rock Johnson, the Terra Mana tequila, maybe significantly higher since it is moving over 170,000 cases per month, which is a staggering number on Good for him.
So as you can see in success, big numbers are possible with celebrity back liquors, may we be as lucky. While we can't promise the same results, of course, we believe we are playing in the same space and have the marketing expertise to give stable gin the best possible chance for success. And I just want to add that our our fantastic team at the door and again, Charlie, really spearheading this has its own share of experience and success stories in this space, working with liquor brands from creation through successful exit, including recent examples of Jefferson's bourbon, which was sold to Pernod Ricard in 2019 and '21 seats, tequila we sold the Diageo in 2022. So we're not exactly four into the journey. And as many of you know, our company is always looking for innovative ways to leverage our marketing experience and expertise and create value for our shareholders.
The Staples and partnership is a perfect example of this strategy in action, and I want to emphasize that this venture like many of our other ventures does not require any capital expenditure from Dolphin. We anticipate this will be the first of many ventures in the alcoholic alcoholic beverage space for Dolphin and we expect to pursue similar deal structures in the future where we provide where we provide our marketing services in exchange for a share of the upside without capital investment as we continue to pursue these types of ventures. We believe the economic benefits of Dolphin will be substantial. We look forward to sharing more details on the Stapleton partnership and our other upcoming ventures in the spirits space. We believe this is an exciting new area of growth for Dolphin, and we are well positioned to create significant value for our shareholders through our marketing expertise and innovative deal structure, there will be much more to come on Stapleton on our Q1 earnings call.
Okay. Those are some highlights about our ventures division and circling back then in summary, in Q4, Dolphin Entertainment achieved record quarterly revenue of $12 million and positive adjusted operating income of $300,000. Despite the impact of Twin INDUSTRY strikes for the first time in over 60 years, all of our subsidiaries secured high-profile clients and partnerships, and we also acquired special projects. That's the highlight of the quarter for me, which completes the original vision of what we now call the supergroup. And lastly, with special projects added to the fold, we have positioned the Company and our shareholders for upside from all three categories of Dolphin ventures, content, consumer products and live events. The first piece of content, the Blue Angel documentary hits theaters in six weeks growth and is already profitable from our sale of streaming rights to Amazon Prime, where debuts on May 23, as I mentioned, for the consumer product category, we have stable gin hitting the market here in Q2, and we couldn't be more excited. And for the live events category, we are actively IT aiding with special projects, Nicole and Andrea, and expect to be able to announce the idea for our first owned event by the end of this year or in early 2025. All of these ventures will leverage our marketing expertise, and we expect the majority of them like staple gen will not require capital investment from us. So for all of these reasons, Dolphin Entertainment is well positioned for growth and success. We believe focusing on creating shareholder value through innovative partnerships and deal structures while running a sustainable operating company focused on generating increasing adjusted operating income.
Thank you for your continued support, and I'll now turn it over to Mirta.
Mirta Negrini
Thank you, Bill, and good afternoon, everyone. I will now discuss financial results. Total revenue for the fourth quarter ended December 31, 2023 was $12 million, an increase of 8% over the same period in prior year. Adjusted operating income as defined in our earnings release for the three months ended December 31, 2023, was approximately $300,000 as compared to adjusted operating income of approximately $100,000 for the three months ended December 31, 2022. Operating expenses for the three months ended December 31, 2023 were approximately $20 million, including approximately $8.3 million of non-cash or nonrecurring expenses compared to $14.1 million of operating expenses for the three months ended December 31, 2022, including approximately $3.1 million of noncash nonrecurring expenses.
Operating expenses for the quarter ended December 31, 2023 are composed of direct costs, payroll and benefits, selling, general and administrative expenses, acquisition costs, goodwill impairment costs, depreciation and amortization, write-off of notes receivable and legal and professional fees. Direct costs for the quarter ended December 31, 2023, were approximately $300,000 compared to approximately $600,000 for the quarter ended December 31, 2022. payroll costs were approximately $8.9 million in the fourth quarter of 2023 compared to approximately $8 million in the fourth quarter of 2022. Sg&a expenses were approximately $2.4 million in the fourth quarter of 2023 compared to $1.9 million in the fourth quarter of 2022. Acquisition costs were approximately $100,000 in the fourth quarter of 2023 compared to $200,000 in the fourth quarter of 2022. During the fourth quarter of 2023, we impaired goodwill by approximately $3 million as compared to $900,000 impaired in the fourth quarter of 2022, Legal and professional fees were approximately $500,000 in the fourth quarter of 2023 compared to $600,000 in the fourth quarter of 2022.
Operating loss and net loss for the quarter ended December 31, 2023 of approximately $8 million and $9.6 million respectively, include non-cash and or nonrecurring items of approximately $8.3 million and $9 million respectively. These include a $3 million impairment of goodwill, approximately $600,000 of depreciation and amortization, $400,000 of bad debt write-off, $100,000 of acquisition costs and write-off of our notes receivable and Midnight theater in the amount of approximately [one] $4.1 million. The net loss also includes losses from equity investments of approximately $700,000. This compares to an operating loss and net loss for the quarter ended December 31, 2022 of $3 million and $3.3 million, respectively, which included noncash and nonrecurring items from depreciation and amortization of $500,000, $900,000 of goodwill impairment, $200,000 of acquisition costs and $1.4 million of changes in the fair value of contingent consideration.
Net loss also included approximately $100,000 in losses from equity investments in affiliates, loss per share was $0.54 per share based on 17,632,822 weighted average shares outstanding for both basic loss per share and fully diluted loss per share for the three months ended December 31, 2023 loss per share was $0.29 per share based on 11,256,578 weighted average shares outstanding for basic and fully diluted loss per share for the three months ended December 31, 2022.
Cash and cash equivalents of $6.4 million as of December 31, 2023, as compared to $6.1 million as of December 31, 2022. That concludes my financial remarks. I will now ask the operator to open the phone lines for questions. Operator, would you please?
Operator, would you please poll for questions?
Question and Answer Session
Operator
Sure. Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue For participants using speaker equipment. It may be necessary to pick up your handset before pressing the star keys. One moment, please. While we poll for questions. Once again, please press star one if you have a question or comment.
The first question comes from Allen Klee with Maxim. Please proceed.
Allen Klee
Good afternoon. Congratulations on the quarter. Starting off with some 42 West and you mentioned that despite headwinds from the two strikes, some you still perform well, how do you think about how that business will normalize in '24 and down? Maybe how much of the headwinds there were '23 and maybe how much might go away in '24 of?
Bill O'Dowd
Yes, we're So sure, I think balanced drilling time where we feel we had a great quarter, two in a row, the well, the writer strike that started in May didn't really it wasn't as impactful to our business. The actor strike that started in July was very impactful to our business because actors weren't allowed to promote movies so the studios did a double whammy on us because some of the actors took hiatus, they had nothing to promote. They weren't allowed to promote. So they they went on hiatus from our talent division. But then our movie division and many of the studio films and independent films that were going to be released in the fall were pushed till 2024, it pushed everything back. So it's if I'm just being honest, it's a little remarkable to me that the fourth quarter finished as well as it did almost $1 million more than any previous quarter the company because because so much of our drug or not movie business was pushed out and obviously nobody wants to release a movie if the actors in the movie can't promote it, right. So even that strikes ended in November, many of those movies are pushed out of on the fall September through December, you know, weren't even put into the theaters in January or excuse me, in Q1 that it will probably fully normalize by the end of Q2. It's my guess and we're doing fine. It's the impact is lessening every month, but it was an impact in Q4 and very proud of the team for the results against those headwinds.
Allen Klee
That's great. On the digital department on Q4 is usually the seasonally strongest stuff. Can you talk about kind of how you felt about the performance in the quarter and then with on the addition of Domo and why, A., how do you can those be meaningful, meaningful contributors, the department and the Company overall in '24 in Europe?
Bill O'Dowd
Yes, I'll go in the order. You asked the questions, but a resounding yes, on that on the second one, yes, digital apartment had a strong Q4. They hit their goal. I'm also proud of that team to Ali Grande, Sarah Boyce, Carsen Weinberg, Belinda, strong because we merged them pretty social and socially in September. That's that's a heavy lift. And anybody that tells you differently is just has never done the process and it's a big distraction to management and they we really wanted it to be done in September because going into that fourth quarter, which is the heavy selling season, you didn't want that hanging over your head, you certainly didn't want to do a merger in Q4, right? So and rebrand the company. And so and they did all of that work and then still maintain a very steady ship in Q4. I'm very happy with with the results of the digital department at the end of the year there going forward, I really tried to make it an emphasis and kind of signal to the market that this is an emphasis for us. Obviously, the growth of the digital department because it has so much growth potential.
I talked about it on many previous earnings calls on. We're starting to realize that it growth now because flow lab, as an example, that's when you bring in a team of Susan Yara and built a nice little influencer marketing company with 15 dermatologists or so. And and that just immediately establishes that skin care group and brands paid big four credible on authentic voices in that space, and we think there's room to grow in that space.
The beauty category in general, skincare is a big component, but hair care is even bigger. Cosmetics is a separate category. And just to give you a sense of how big this could get for us and work. We're excited to expand that group by itself.
And then I made a point to mention that Susan created a product, launched it in COVID and sold it three years later for a great exit because she living proof of what we're trying to do with our Ventures and skin care is going to be one of the two pillars in beauty and cosmetics generally as well. Beauty category broadly will be one of the two pillars for us along with liquor and where we feel like once we get it up and running, we can be launching a product a year. And so it was a highly strategic move for us to bring Susan and her group in and very blessed about that. That will be immediate revenue there.
15 influencers, that's immediate revenue for us. I plug and play in the YA. space, thankfully, for that partnership with US Bank because while we very much wanted to add 10s and young adults to the digital apartment, if we have built to one influencer at a time on a hiring manager and do that it could have taken us no less than a year, probably closer to 18 months to 24 months. That were viable roster, 10 or 12 working clients that are meaningful in that space with us, frankly, feel like we just we just represent that roster for digital overnight. You've got two dozen 10s and young adults that that are on TV shows or movies. And it's just such an advantage because they all have social profiles too. So we're excited to be able to start monetizing that and probably in earnest here in Q2 as we put the roster together between February and March, I'd say that's the timing of those of those two and when they have an impact.
Allen Klee
Thank you.
One follow up on, um, on a digital department, this is I don't know how you answer what the probability is, but in our government's talking about potentially on maybe banning TikTok, making it harder for them to operate. How do you think about that like?
Well, I don't know how to put out of food how do you think about if you offering or what I have, what impact that might have?
Bill O'Dowd
Well for us?
Yes, I make I take no position on whether it will or won't lose as you as you gather too on, I don't know, but it will really come down to individual creators are let me back up in the digital department as three divisions. We manage individual talents and take a percentage of their revenue. We we we have a brands division where we represent brands and design influencer marketing campaigns for them and execute them. And we have an Events division on the Live Events division platforms don't don't impact us on the brand side. The brands will just adapt and shift their ad dollars from a TikTok campaign to an Instagram campaign or a YouTube campaign, and we'd be managing it anyway. It won't have an impact on the talent side. There will be some and some talent out there in the world that are only on TikTok or export primarily on TikTok. That will be impacted because of the transfer they're following over most likely to either will most likely YouTube on a video platform. And that may and that may take some time or or for the followers to move over with them. But in today's world, that time might be a day of four days. But fortunately, for the digital department, we're weighted heavily on a platform of that platforms, Instagram. And what we want to do with moves like this why a roster is diversify and get a little bit more balanced with TikTok and YouTube. And if there is no TikTok and YouTube on whatever comes next. So fortunately, it shouldn't have much of an impact on us at all if TikTok goes away.
Allen Klee
Thank you, and I'm excited about Blue Angels coming out as a lot of people are on. I'm curious, it looks like the time that it will be in IMAX theaters broader than what I thought. Was there a different thinking of how long was the NIMAX. versus then going to come from?
Bill O'Dowd
Well, the that's not that I apologize. We could have made that clear, Alan. It's not that it leaves theaters. It's just that it's only in theaters for that first week and then it can continue its run on.
So I understand Amazon at first was debating.
Is it a July fourth release or Memorial Day release and a more real Day weekend. As such, the kickoff of movie movie watching and moviegoing and will be on top of mind for everybody is generally the kickoff of the summer season right now that some of the Avengers movies didn't come out earlier, but and some of the big temples are again this year. So they just didn't want to lose the Memorial Day weekend for their for their opportunity as well. So we certainly understand that. That's the weekend we premier Top Gun two years ago. It may or may fighter jets be in vogue again, this Memorial Day and the Blue Angels themselves have some high-profile shows in real life over that weekend as well. So we know we can promote the sugar out of this film on that weekend. So the thought was launched exclusively in IMAX May 17. Let it run as long as it intends to run and in other theaters potentially to after that first week when it's only available on IMAX, but then have Amazon be able to have viewership numbers that capture that type of excitement around the film.
Allen Klee
If that explains it. Well, thank you on. And then. But within that, how are you thinking about, you know, the dividend, the next partnership, the next movie is that is that likely a 25 event? Or how do you think about thinking about that?
Bill O'Dowd
Yes, we think so to say, yes, we do think that way it shockingly your an update, as I'm sure for yourself big surprise, you're not the first person to ask a home, and this is so great what's next? And we're excited to, hopefully share with the next partner movie with IMX will be as soon as we can. You can imagine with this and there's no shortage of people looking to partner up because maybe it's going maybe to go back a step it's worth noting, too. I think I said it on his earnings calls and we formed this partnership. I'm unaware. I there is to my knowledge, there's no other deal in the market there in the industry where there's a guaranteed theatrical release for a documentary and with IMAX and often, we're both thinking about how can we bring something new to the marketplace and this idea of for lack of a better word, big spectacle documentaries, we're going to have to come up with a catchy phrase for that, but like with supergroup, but from the idea of a Blue Angels or something like that in Eimac, it's not your father's Oldsmobile. It's not your father's house through crime documentary, it's theatrical. It's big. And this movie delivers on that promise.
It's a great first movie in that fleet. So when you've got a hit out of it out of the gate and you've got some different like that then it's really just a matter of choosing what do you want that next big one to be on the net. Hopefully, you don't suffer a sophomore slump right on and it is because I'm grabbing as seeing fighter jets, 12 inches apart from my camera 12 inches apart here, though, not from the ground or it.
So yes, we think that the we'll have an announcement obviously this year for what could either be filmed or released in 2025, you start getting to a regular cadence with it.
Allen Klee
That's great. Thank you. Tom for MasterCard, midnight theater and hidden lease. Your comments there of looking to change, then you have midnight of a hit in the when you were just saying that didn't perform to expectations that were you referring just to the restaurant, the restaurant and master Ford mid-80s?
Bill O'Dowd
Well, we really do are trying to bring in an operator for the restaurant on it's very hard to have a successful venue, including theaters, restaurants not hitting its goals. And so it's an opportunity to kind of reconceptualize and maybe bring in a bigger operator, especially because you're coming out of the historically slow Q1, right restaurants in Manhattan and anywhere in the northern city don't do as well in the winter as they would in the summer or fall rush. So people just don't go out as much. So it felt like the right time to put in a new concept if we can. So that's why we've prioritized the search to to and we are talking to groups and actively now to see if we can come up with a new concept for the key summer and fall seasons.
Now there's no assurance that a deal will close, but we have identified the first group that we'd like to bring in. We're working hard to close a deal in the next few weeks.
Allen Klee
That's great. And okay, just I'll just finish up quick one of a few finance questions. I know you haven't giving guide and are you able to give anything qualitatively of if you think you might be able to grow revenue? And it's if so, what would be the drivers to that?
Bill O'Dowd
Sure. Well, I am happy we beat our beloved analysts' expectations for Q4. We hope to be able to do that again here in Q1. The two drivers on which won't come as a surprise, given our prepared remarks for the last three years, right? Yes, will each year we've added a new member of our group. It exponentially increases the amount of collaborations that can occur.
Right. I think Tim Johnson from Bart pointed out to me in a mathematical formula to do it, but we only have one company. You can't cross-sell with anybody. And when you have two, it can only go in two directions. But by the time you get to three, you know, there's like six different strings to the spider web. No, now we're up to effectively six marketing companies and an operating Film Production division. So we're exponentially more intricate and Special Projects plugs in beautifully on this as an additional offering. There's been oh, goodness, I think no less than half a dozen introductions to potential new clients for special projects in the last week or two alone. I attended one of them, and it was extremely well received. So the idea to organically grow our subsidiaries through cross-selling and through new introductions is just this is very, very real. And that's why we wanted to live with a company that comes out of Hollywood instead of let's say and non entertainment live event company because special projects, when they're doing the Motion Picture Academy, the Oscars people right there, Gail, and that's a direct hit to somebody in a calling card for any number of people that 40 to us could introduce into. So organic growth will be we'll be strong, we feel.
But then now look where we are with our ventures. We've talked about it for a couple of years, but now we have all the pieces in place to have a really strong pipeline of ventures on Q2 is going to be pretty big next earnings call on May 15. We think we are having a strong Q1. We have a film coming out two days later on from May 15. We'll have a liquor in market and probably by the time we're on the call, in which case unless you have a sample to everybody on the call right on. So it is happening now where we're moving to the point where these earnings calls are giving updates on those types of things. Opportunities for Dolf in each one of those can represent very large revenue exits in time or immediate like like Blue Angels on. And that will that will certainly be jolts of growth that we just didn't have in past years as we were building this group, right? And we have a couple of them in May. We made out of those two in a couple of more later in the year and soon if you're trying to keep everybody abreast of hopefully, six, eight, 10, 12 ventures in a couple of years, and that's very exciting for us.
Allen Klee
Right. Okay. That's it for me to. Thank you very much.
Bill O'Dowd
And a springboard off that one idea to Alan, I'm sorry, I should have said too. On the digital department, we announced Susan Yara and go live in January. We announced the YA. in February.
We don't think we're done a significant hole. So let's see if there's another announcement or two this year and there's just so much growth in new spaces for the digital department. And in each of those, they're not as big as our Blue Angels or heaven forbid, a successful staple gin with Rachael Ray, but they're meaningful and they could launch new businesses for us as well. So there'll be some announcements on that front as well, too. We think so. Thank you for your time and questions, Allen
Thank you.
Operator
Hey, we have no further questions in queue. I will now turn the call over to Bill O'Dowd for closing remarks.
Bill O'Dowd
No, thank you. Thank you, everyone, for listening and it's nice to be here at the 10 K for 2023. From reiterate, welcome to special projects for a company that on as in a short period of time, grown to be very special in my heart.
I just I just think the world of Nicole and Andrea and their entire team at Chubb mall down by name. I hope I was given the time right on very high-quality people, very strong workers and they built a beautiful company. So excited for what will come with special projects should be more of a feature of these calls, probably in the second half of the year on given overall, obviously, the company's got a little bit of a buzz about it, a little bit of a swagger given Blue Angels and the drop of the trailer and the fact that it's in theaters and just a few weeks on and and the Q1 earnings call, well, the duking out to between what we lead with. I see their Blue Angels are for Rachel's, Jan and some updates on both of those fronts.
Thank you, everybody, for joining today, and thank you.
For the journey. I know it's a it's a Thursday night before holiday weekend, but we couldn't be more excited for the Company and look forward to the next call. Thank you all very much.
Operator
This concludes today's conference and you may disconnect your lines at this time. Thank you for your participation.
