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Dolphin Entertainment(DLPN) - 2024 Q2 - Quarterly Report
DLPNDolphin Entertainment(DLPN)2024-08-14 21:15
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Revenue Performance - For the six months ended June 30, 2024, total revenue was 26,684,981,anincreaseofapproximately26,684,981, an increase of approximately 5,768,625 compared to 20,916,356forthesameperiodin2023[119].−RevenuefromtheentertainmentpublicityandmarketingsegmentforthethreemonthsendedJune30,2024was20,916,356 for the same period in 2023[119]. - Revenue from the entertainment publicity and marketing segment for the three months ended June 30, 2024 was 11,449,089, up from 11,024,935inthesameperiodof2023,reflectinganincreaseofapproximately11,024,935 in the same period of 2023, reflecting an increase of approximately 424,154[119]. - Revenue from content production for the six months ended June 30, 2024 was 3,421,141,attributedtothereleaseof"TheBlueAngels"documentaryfilm[120].−TheacquisitionofSpecialProjectsin2023contributedapproximately3,421,141, attributed to the release of "The Blue Angels" documentary film[120]. - The acquisition of Special Projects in 2023 contributed approximately 1.6 million in revenue for the six months ended June 30, 2024, which was not present in 2023[119]. - The entertainment publicity and marketing segment accounted for 86.9% of total revenue for the six months ended June 30, 2024, while content production accounted for 13.1%[116]. - The company recorded 3,421,141inrevenuerelatedtotheAmazonAgreementfor"TheBlueAngels"duringthesixmonthsendedJune30,2024[115].ExpensesandLosses−TotalexpensesforthethreemonthsendedJune30,2024,wereapproximately3,421,141 in revenue related to the Amazon Agreement for "The Blue Angels" during the six months ended June 30, 2024[115]. Expenses and Losses - Total expenses for the three months ended June 30, 2024, were approximately 12.57 million, a decrease from 18.48millionforthesameperiodin2023,whiletotalexpensesforthesixmonthsendedJune30,2024,were18.48 million for the same period in 2023, while total expenses for the six months ended June 30, 2024, were 27.64 million compared to 30.93millionin2023[121].−Payrollandbenefitsexpensesincreasedbyapproximately30.93 million in 2023[121]. - Payroll and benefits expenses increased by approximately 0.5 million and 1.0millionforthethreeandsixmonthsendedJune30,2024,respectively,primarilyduetotheinclusionofSpecialProjectspayrollexpenses[122].−NetlossforthethreemonthsendedJune30,2024,wasapproximately1.0 million for the three and six months ended June 30, 2024, respectively, primarily due to the inclusion of Special Projects payroll expenses[122]. - Net loss for the three months ended June 30, 2024, was approximately 1.6 million or (0.08)pershare,comparedtoanetlossofapproximately(0.08) per share, compared to a net loss of approximately 8.0 million or (0.60)pershareforthesameperiodin2023[129].CashFlowandDebt−Cashprovidedbyoperatingactivitieswas(0.60) per share for the same period in 2023[129]. Cash Flow and Debt - Cash provided by operating activities was 0.66 million for the six months ended June 30, 2024, a change of 3.77millionfromcashusedinoperatingactivitiesof3.77 million from cash used in operating activities of 3.1 million for the same period in 2023[132]. - Total debt amounted to 20.9millionasofJune30,2024,anincreaseof20.9 million as of June 30, 2024, an increase of 1.6 million from 19.3millionasofDecember31,2023[135].−Cashandcashequivalentsattheendoftheperiodwere19.3 million as of December 31, 2023[135]. - Cash and cash equivalents at the end of the period were 9.85 million as of June 30, 2024, compared to 8.13millionattheendofthesameperiodin2023[131].−CashflowsprovidedbyfinancingactivitiesforthesixmonthsendedJune30,2024,were8.13 million at the end of the same period in 2023[131]. - Cash flows provided by financing activities for the six months ended June 30, 2024, were 2.76 million, compared to 4.05millionforthesameperiodin2023[134].ImpairmentandTax−Impairmentofgoodwillwas4.05 million for the same period in 2023[134]. Impairment and Tax - Impairment of goodwill was 0.2 million for both the three and six months ended June 30, 2024, compared to 6.5millionforthesameperiodsin2023[123].−Thecompanyrecordedanincometaxexpenseofapproximately6.5 million for the same periods in 2023[123]. - The company recorded an income tax expense of approximately 23.5 thousand and 47.1thousandforthethreeandsixmonthsendedJune30,2024,respectively[128].StockandFinancingActivities−Thecompanysold950,000sharesofitscommonstockduringthesixmonthsendedJune30,2024,receivingproceedsof47.1 thousand for the three and six months ended June 30, 2024, respectively[128]. Stock and Financing Activities - The company sold 950,000 shares of its common stock during the six months ended June 30, 2024, receiving proceeds of 1.19 million[137]. - As of June 30, 2024, the Company has ten convertible notes payable outstanding with a principal balance of 5,100,000recordedinnoncurrentliabilities[140].−Interestexpenserelatedtoconvertiblenotespayablewas5,100,000 recorded in noncurrent liabilities[140]. - Interest expense related to convertible notes payable was 127,500 for Q2 2024, a decrease of 10% from 141,583inQ22023[140].−TheCompanyrecordedgainsinfairvalueof141,583 in Q2 2023[140]. - The Company recorded gains in fair value of 40,000 for Q2 2024, compared to 4,000inQ22023,indicatingasignificantincreaseinfairvalue[142].−TheCompanyhasoutstandingunsecurednonconvertiblepromissorynotestotaling4,000 in Q2 2023, indicating a significant increase in fair value[142]. - The Company has outstanding unsecured nonconvertible promissory notes totaling 3,880,000, with interest expenses of 97,000forQ22024,downfrom97,000 for Q2 2024, down from 153,468 in Q2 2023[144]. - The Socialyte Promissory Note, amounting to 3,000,000,hasaccruedinterestof3,000,000, has accrued interest of 30,000 for Q2 2024, with no payments made during the period[146]. - The Company entered into a loan agreement with BankUnited, including a 5,800,000securedtermloananda5,800,000 secured term loan and a 750,000 revolving line of credit[150]. - As of June 30, 2024, the principal outstanding under the BKU Term Loan was 5,002,520,adecreasefrom5,002,520, a decrease from 5,482,614 as of December 31, 2023[154]. - The Company recorded interest expense of 68,760fortheMockNotesinQ22024,comparedto68,760 for the Mock Notes in Q2 2024, compared to 27,621 in Q2 2023, reflecting an increase in interest costs[149]. - The BankUnited Loan Agreement requires the Company to maintain a minimum debt service coverage ratio of 1.25:1.00 and a maximum funded debt/EBITDA ratio of 3.00:1.00[152]. - The Company has filed a lawsuit against the seller of Socialyte related to the Socialyte Purchase Agreement, impacting the payment schedule of the promissory note[146]. Strategic Initiatives - The company has established an acquisition strategy to identify and acquire complementary businesses, with the acquisition of Elle Communications, LLC completed in July 2024[102]. - The company plans to enter into additional investments in 2024 under its "Ventures" strategy, focusing on entertainment content, live events, and consumer products[103]. - The company expects growth in its Talent departments due to increasing demand for strategic communication services in the entertainment industry[107]. - The company has a stable client base and continues to grow organically through referrals and new business solicitations[106].