-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HLrSIVfJ2MRj7s9BtixA9lPVQTJJVnxPIqLv1lmIscpSZl4AMtLBrP8twH0kdzqy 7DiFz467SKz2zY/fB/eCkg== 0000890163-03-000038.txt : 20030612 0000890163-03-000038.hdr.sgml : 20030612 20030612080539 ACCESSION NUMBER: 0000890163-03-000038 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030612 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030612 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEW FRONTIER MEDIA INC /CO/ CENTRAL INDEX KEY: 0000847383 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MOTION PICTURE & VIDEO TAPE DISTRIBUTION [7822] IRS NUMBER: 841084061 STATE OF INCORPORATION: CO FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-23697 FILM NUMBER: 03741422 BUSINESS ADDRESS: STREET 1: 5435 AIRPORT BLVD STREET 2: SUITE 100 CITY: BOULDER STATE: CO ZIP: 80301 BUSINESS PHONE: 3034440632 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL SECURITIES HOLDING CORPORATION DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: STRATEGIC ACQUISITIONS INC DATE OF NAME CHANGE: 19600201 8-K 1 s11-3664_8k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Date of Report (Date of earliest event reported): June 12, 2003 NEW FRONTIER MEDIA, INC. ----------------------------------------------------- (Exact name of registrant as specified in its charter) Colorado 000-23697 84-1084061 ------------- --------------- ----------------- (State of (Commission File (IRS Employer I.D. Incorporation) Number) Number) 7007 Winchester Circle Suite 200 Boulder, Colorado 80301 (303) 444-0900 ------------------------------- (Address and telephone number of principal executive offices) Item 7. Financial Statements and Exhibits. (c) Exhibits Exhibit No. Exhibits. - ----------- --------- 99.1 Press Release issued by New Frontier Media, Inc. dated June 12, 2003 Item 9. Regulation FD Disclosure The information contained in this report is being furnished pursuant to Item 12 under Item 9 of Form 8-K. On June 12, 2003, New Frontier Media, Inc., a Colorado corporation (the "Registrant")issued the attached press release that includes financial information for the fourth quarter of fiscal 2003 and for the fiscal year ended March 31, 2003. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference in its entirety. The press release presents EBITDA - - a non-GAAP financial measure. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a registrant's historical or future financial performance, financial position or cash flows that exclude amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the issuer. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to the requirements of Regulation G, the Registrant has provided a reconciliation within the earnings release of the non-GAAP financial measure to the most directly comparable GAAP financial measure. EBITDA measures the amount of income generated each period by the Registrant that could be used to service debt, pay taxes and fund capital expenditures. It is important to note, however, that EBITDA does not represent cash provided or used by operating activities. EBITDA should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. EBITDA is presented in the press release because the Registrant's management uses this information in evaluating the operating efficiency and overall financial performance of its business. The Registrant's management also believes that this information provides the users of the Registrant's financial statements a valuable insight into its operating results. 2 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. NEW FRONTIER MEDIA, INC. (Registrant) June 12, 2003 By: /S/ MICHAEL WEINER ---------------------------------- Michael Weiner, President 3 EXHIBIT INDEX Exhibit No. Exhibits. - ----------- --------- 99.1 Press Release issued by New Frontier Media, Inc. dated June 12, 2003 4 EX-99 3 s11-3664_ex991.txt EXHIBIT 99.1 NEW FRONTIER MEDIA For Immediate Release Contact: Karyn Miller, CFO (303) 444-0900 x 102 kmiller@noof.com New Frontier Media Announces Profitable Fourth Quarter BOULDER, COLORADO, June 12, 2003 -- New Frontier Media, Inc. (Nasdaq: NOOF), a leader in the electronic distribution of adult entertainment, announced its results for the fourth quarter and full year ended March 31, 2003. On a consolidated basis, the Company reported net income for the fourth quarter ended March 31, 2003 of $0.7 million, or $0.04 per basic and fully diluted earnings per share. EBITDA (earnings before interest, taxes, depreciation and amortization) for the fourth quarter ended March 31, 2003, before $0.3 million in restructuring costs, was reported as $2.0 million, representing a 25% increase over fiscal 2002 fourth quarter EBITDA, before $3.2 million of restructuring costs, of $1.6 million. The Company reported revenue of $9.3 million for the fourth quarter ended March 31, 2003, representing a 17% decrease over fiscal 2002 fourth quarter net revenue of $11.2 million. The decrease in fourth quarter revenue was driven by the continued refocusing of the Company's Internet business, which experienced a 68% decrease in year-over-year quarterly revenue. Revenue for New Frontier Media, Inc.'s core Pay TV business (Subscription/PPV TV Group) for the fiscal 2003 fourth quarter was $8.0 million, representing an 11% increase over revenue for the fiscal 2002 fourth quarter. Pay TV EBITDA for the fiscal 2003 fourth quarter was $3.2 million, representing a 39% improvement over fiscal 2002 fourth quarter EBITDA. "We are very excited about the strong growth we are seeing in our core Pay TV business. Our ability to deliver superior results in this segment gives us great optimism for fiscal 2004. Today more people, in more places, are seeing our networks and services than ever before," said Michael Weiner, President of New Frontier Media, Inc. FULL YEAR RESULTS The Company reported fiscal 2003 net revenue of $36.7 million, representing a 30% decrease over fiscal 2002 net revenue of $52.4 million. The decrease in revenue is, again, related primarily to a 66% decrease in revenue from the Company's Internet Group. Fiscal 2003 adjusted EBITDA for the Company, before restructuring and impairment charges of $4.6 million related to the Internet Group, was reported as $3.1 million, or a 62% decrease over fiscal 2002 adjusted EBITDA, before restructuring charges of $3.2 million related to the Internet Group, of $8.1 million. The Company reported a net loss for the fiscal year ended March 31, 2003 of $11.9 million, or $0.56 per basic and fully diluted share, which included the following items: a) $4.6 million of restructuring and impairment charges related to the Company's Internet Group; b) a $5.3 million non-cash provision for income taxes due to the Company providing a full valuation allowance against its deferred tax assets; and c) $2.0 million in expenses related to the Company's proxy fight and its lawsuit with a former director of the Company. Cash flow from operations for the fiscal year ended March 31, 2003 was at breakeven. SUBSCRIPTION/PPV TV GROUP The Subscription/PPV TV Group reported revenue of $8.0 million for the fourth quarter ended March 31, 2003, representing an 11% increase over fiscal 2002 fourth quarter revenue of $7.2 million. Revenue from the Group's cable/DBS products was $6.1 million for the 2003 fiscal fourth quarter, representing a 22% increase over 2002 fiscal fourth quarter cable/DBS revenue of $5.0 million. The Subscription/PPV TV Group reported EBITDA of $3.2 million for the fourth quarter ended March 31, 2003, representing a 39% increase over fiscal 2002 fourth quarter EBITDA of $2.3 million. This growth can be attributed to a significant expansion in distribution of the Subscription/PPV TV Group's networks during the quarter. The Pay TV Group's networks are now available in 41 million network homes, up from 29.7 million a year ago. Further, the Company's Video-on-Demand ("VOD") product is available in 5.3 million addressable homes as of March 31, 2003, up from 1.1 million addressable households a year ago. In addition, the Subscription/PPV TV Group achieved the following milestones during the 2003 fiscal year: - Launched two new networks, TEN Blue and TEN Blox - Signed a major VOD transport deal with TVN Entertainment Corporation, giving the Subscription/PPV TV Group access to over 2 million additional VOD households - Signed a distribution agreement with On Command Corporation for distribution of its VOD content through On Command's 895,000 hotel rooms - Unified its family of networks under the ten* name and logo INTERNET GROUP The Internet Group reported revenue of $1.3 million and adjusted EBITDA, before restructuring costs of $0.3 million, of $0.2 million for the fourth quarter ended March 31, 2003. As of March 31, 2003, the Internet Group had merged all of its dial-up Internet membership websites into its premiere broadband site, www.ten.com. The Internet Group's core focus going forward will be on promoting the distribution of www.ten.com through revenue-sharing agreements with mainstream third-party gatekeepers such as hospitality providers, cable companies, and portals. Revenue generated by memberships to www.ten.com is expected to decline further, but the Internet Group expects to ultimately replace this revenue through its third-party gatekeeper relationships. The Company does not anticipate any further restructuring or impairment charges related to the Internet Group. FUTURE OUTLOOK The Company is providing the following guidance for its fiscal year ended March 31, 2004: - Revenue of $35 million to $40 million, which assumes a continued decline in revenue generated by the Internet Group and the Subscription/PPV TV Group's C-Band services, offset by double-digit growth in the Subscription/PPV TV Group's cable/DBS revenue - Net Income of $2.0 million to $4.0 million CONFERENCE CALL New Frontier Media will be conducting its conference call and webcast to discuss earnings today at 2:15 p.m. Mountain Time. The participant phone number for the conference call is (800)-218-0204. To participate in the webcast please log on to www.noof.com and click on Investor Relations and then Webcasts and Events. A replay of the conference call will be available for seven days after 5:15 p.m. Mountain Time on June 12th at (800)-405-2236, access code 541321. The replay will also be archived for twelve months on the Company's corporate web site at www.noof.com under Investor Relations/Webcasts and Events. This press release can be found on the Company's corporate web site, www.noof.com, under Investor Relations/News Releases. This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements are based on current expectations, estimates and projections made by management. The Company intends for the forward-looking statements to be covered by the safe harbor provisions for forward-looking statements. All statements related to the expected continued decline in revenue generated by memberships to www.ten.com, the replacement of membership revenue for www.ten.com with revenue from third-party gatekeeper relationships, the incurrence of further restructuring or impairment charges related to the Internet Group, or the Company's guidance provided for the 2004 fiscal year, and the outcome of any contingencies are forward-looking statements. Words such as "anticipates", "expects", "intends", "plans", "believes", "seeks", "estimates", or variations of such words are intended to identify such forward-looking statements. All forward-looking statements made in this press release are made as of the date hereof, and the Company assumes no obligation to update the forward-looking statements included in this news release whether as a result of new information, future events, or otherwise. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth or implied by any forward-looking statements. Please refer to the Company's Form 10-K and other filings with the SEC for additional information regarding risks and uncertainties, including, but not limited to, the risk factors listed from time to time in such SEC reports. Copies of these filings are available through the SEC's electronic data gathering analysis and retrieval system (EDGAR) at www.sec.gov. ABOUT NEW FRONTIER MEDIA, INC. New Frontier Media, Inc. is a leading distributor of adult entertainment via electronic platforms. The Company delivers the most extensive lineup of quality programming over the broadest range of electronic means including cable, satellite, Internet, Broadband and video-on-demand. The Erotic Networks(TM), the umbrella brand for the Company's subscription and pay television subsidiary, provides pay-per-view and subscription TV networks to over 45 million cable, DBS (direct broadcast satellite) and C-band households throughout North America. The Erotic Networks(TM) include Pleasure(TM), TEN(TM), TEN Clips(TM), TEN Xtsy(TM), TEN Blue(TM), TEN BluePlus(TM), TEN Blox(TM), TEN Max(TM) and TEN On Demand(TM). These networks represent the widest variety of editing standards available and are programmed without duplication to offer the most extensive selection of adult network programming under a single corporate umbrella. For more information contact Karyn Miller, Chief Financial Officer, at (303) 444-0900, extension 102, and please visit our web site at www.noof.com. Consolidated Operating Results (in '000's except per share amounts)
Three Months Ended Twelve Months Ended March 31, March 31, 2003 2002 2003 2002 Revenue $9,280 $11,214 $36,747 $52,435 Cost of Sales (4,056) (5,510) (18,197) (25,634) ------- ------- ------- ------- Gross Profit 5,224 5,704 18,550 26,801 Operating Expenses (4,312) (8,561) (23,543) (27,429) ------- ------- ------- ------- Other Income (Expense) (195) (363) (1,631) 372 Income (Loss) Before Minority 717 (3,220) (6,624) (256) Interest and Income Taxes Minority Interest 0 (171) 0 (171) Income tax (expense) benefit (5) 1,035 (5,271) (155) Net Income (Loss) $ 712 ($2,356) ($11,895) ($582) ======= ======= ======= ======= Basic Income (Loss) Per Share $0.04 ($0.11) ($0.56) ($0.03) Diluted Income (Loss) Per Share $0.04 ($0.11) ($0.56) ($0.03) Weighted Average Shares 21,373 21,207 21,307 21,128 Outstanding Reconciliation of Net Income (Loss) to EBITDA as reported Net Income (Loss) $712 ($2,356) ($11,895) ($582) Adjustments: Dep'n and Amort.(1) 744 1,444 3,469 5,750 Interest Expense 261 392 1,631 1,843 Interest Income (10) (28) (61) (193) Income Taxes 5 (1,035) 5,271 155 Restructuring/Impair. 303 3,158 4,570 3,158 Non-cash loss on stock 0 0 117 0 Legal reserve 0 0 0 (1,680) Other income 0 0 0 (341) EBITDA as reported $2,015 $1,575 $3,102 $8,110
(1) Amortization excludes amortization of content licenses The Condensed Statement of Operations should be read in conjunction with the Company's Form 10-K that will be filed with the Securities and Exchange Commission. To obtain a copy please contact New Frontier Media, Inc. -----END PRIVACY-ENHANCED MESSAGE-----