Exhibit 99.1
BAM! ENTERTAINMENT ANNOUNCES FISCAL FOURTH QUARTER RESULTS
COMPANY RECEIVES NOTICE FROM NASDAQ THAT IT FULLY COMPLIES WITH LISTING REQUIREMENTS
San Jose, Calif. – September 30, 2003– BAM! Entertainment® (NASDAQ: BFUN), a developer and publisher of interactive entertainment software, today reported results for its fiscal fourth quarter ended June 30, 2003.
The company reported net revenues for the fiscal fourth quarter of $2.1 million, a decrease of 85% from net revenues of $14.0 million for the same quarter of the prior fiscal year. The operating loss for the quarter was $9.3 million and net loss for the quarter was $9.2 million, equivalent to 63 cents per share. In the same quarter of the prior year, the company sustained an operating loss of $5.1 million and a net loss of $5.2 million, equivalent to 35 cents per share. During the quarter ended June 30, 2003, the company did not release any new products. In the same quarter of the prior fiscal year the company released five new products.
“The results for the quarter reflect our continued efforts to narrow our product strategy, undertake cost cutting measures and stabilize our fixed expenses and cash outflow,” said Ray Musci, Chief Executive Officer of BAM! Entertainment. “Certainly this has been a very difficult and hard fought process. The restructuring we commenced in early November 2002 is substantively complete, which we believe has positioned our company as a leaner organization with a much clearer product focus, and with an eye towards a return to profitability during the holiday period upon the release of our key titles. Our restructuring and our recently completed inventory and receivable financing facility are solid steps in getting BAM! back on a growth track in a very dynamic market and increasingly competitive environment” said Musci.
Key titles currently slated for release during the remainder of calendar year 2003 include: Wallace & Gromit in Project Zoo, the first product scheduled for release under the company’s agreement with Oscar award-winning Aardman Animation Studios; the first release of Carmen Sandiego for next generation consoles; and an action-adventure game based on the popular Cartoon Network™ franchise The Powerpuff Girls™.
The company also announced today that it had received notice from Nasdaq that the company was now in compliance with all listing requirements of The Nasdaq SmallCap Market and that it’s securities are no longer subject to delisting.
About BAM! Entertainment, Inc.
Founded in 1999 and based in San Jose, California, BAM! Entertainment, Inc. is a developer, publisher and marketer of interactive entertainment software worldwide. The company develops, obtains, or licenses properties from a wide variety of sources, including global entertainment and media companies, and publishes software for video game systems, wireless devices, and personal computers. The company’s common stock is publicly traded on NASDAQ under the symbol BFUN. More information about BAM! and its products can be found at the company’s web site located at www.bam4fun.com.
Financial Contact: | BAM! Entertainment, Inc. Stephen Ambler Chief Financial Officer Tel.: (408) 298-7500 E-mail: sambler@bam4fun.com |
This release contains statements that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current estimates and projections about BAM! Entertainment’s business, which are derived in part on assumptions of its management, and are not guarantees of BAM! Entertainment’s future performance, as such performance is difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors. Such factors include, but are not limited to, those described in BAM! Entertainment’s Annual Report on Form 10-K for the year ended June 30, 2003, which is filed with the U.S. Securities and Exchange Commission. Readers of this release are referred to this filing. BAM! Entertainment does not intend to update any of these forward-looking statements after the date of this release.
BAM! Entertainment, BAM! and BAM!4 are trademarks of BAM! Entertainment, Inc. PlayStation is a registered trademark of Sony Computer Entertainment Inc. Nintendo GameCube is a trademark of Nintendo of America, Inc. Nintendo and Game Boy Advance are trademarks of Nintendo. Xbox is a trademark of Microsoft Corporation. All other trademarks are the property of their respective owners.
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BAM! ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Amounts in thousands, except per share amounts)
(Unaudited)
Three months ended | Year ended | |||||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||||
2003 | 2002 | 2003 | 2002 | |||||||||||||||||||||||||
Net revenues | $ | 2,097 | $ | 13,976 | $ | 35,708 | $ | 50,734 | ||||||||||||||||||||
Costs and expenses: | ||||||||||||||||||||||||||||
Cost of revenues | ||||||||||||||||||||||||||||
Cost of goods sold | 2,410 | 7,790 | 23,124 | 29,826 | ||||||||||||||||||||||||
Royalties, software costs, and license costs | 3,242 | 4,485 | 18,739 | 12,101 | ||||||||||||||||||||||||
Project abandonment costs | 2,955 | 601 | 9,600 | 693 | ||||||||||||||||||||||||
Total cost of revenues | 8,607 | 12,876 | 51,463 | 42,620 | ||||||||||||||||||||||||
Research and development (exclusive of amortization of deferred stock compensation) | 337 | 886 | 2,912 | 2,519 | ||||||||||||||||||||||||
Sales and marketing (exclusive of amortization of deferred stock compensation) | 1,022 | 3,317 | 9,220 | 11,473 | ||||||||||||||||||||||||
General and administrative (exclusive of amortization of deferred stock compensation) | 1,387 | 1,880 | 7,164 | 6,293 | ||||||||||||||||||||||||
Amortization of deferred stock compensation* | 80 | 150 | 418 | 1,223 | ||||||||||||||||||||||||
Restructuring costs | (33 | ) | — | 426 | — | |||||||||||||||||||||||
Total costs and expenses | 11,400 | 19,109 | 71,603 | 64,128 | ||||||||||||||||||||||||
Loss from operations | (9,303 | ) | (5,133 | ) | (35,895 | ) | (13,394 | ) | ||||||||||||||||||||
Interest income | 2 | 97 | 148 | 328 | ||||||||||||||||||||||||
Interest expense | (21 | ) | (110 | ) | (597 | ) | (2,569 | ) | ||||||||||||||||||||
Other income (expense) | 103 | (30 | ) | 151 | (38 | ) | ||||||||||||||||||||||
Net loss | $ | (9,219 | ) | $ | (5,176 | ) | $ | (36,193 | ) | $ | (15,673 | ) | ||||||||||||||||
Net loss per share: | ||||||||||||||||||||||||||||
Basic and diluted and diluted | $ | (0.63 | ) | $ | (0.35 | ) | $ | (2.47 | ) | $ | (1.65 | ) | ||||||||||||||||
Shares used in computation: | ||||||||||||||||||||||||||||
Basic and diluted | 14,678 | 14,583 | 14,654 | 9,503 | ||||||||||||||||||||||||
*Amortization of deferred stock compensation: | ||||||||||||||||||||||||||||
Research and development | $ | 2 | $ | (43 | ) | $ | (25 | ) | $ | 126 | ||||||||||||||||||
Sales and marketing | 2 | (3 | ) | (7 | ) | 70 | ||||||||||||||||||||||
General and administrative | 76 | 196 | 450 | 1,027 | ||||||||||||||||||||||||
$ | 80 | $ | 150 | $ | 418 | $ | 1,223 | |||||||||||||||||||||
BAM! ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Amounts in thousands)
(Unaudited)
June 30, | June 30, | |||||||||
2003 | 2002 | |||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 1,068 | $ | 4,726 | ||||||
Short-term investments | — | 8,185 | ||||||||
Accounts receivable, net of allowance of $2,722 and $3,720 as of June 30, 2003 and 2002, respectively | 539 | 10,183 | ||||||||
Inventories | 961 | 3,945 | ||||||||
Prepaid royalties | 1,067 | 1,007 | ||||||||
Prepaid expenses and other | 1,036 | 2,539 | ||||||||
Total current assets | 4,671 | 30,585 | ||||||||
Capitalized software and licensed assets, net | 4,138 | 15,478 | ||||||||
Property and equipment, net | 597 | 987 | ||||||||
Long-term receivable, net of allowance of $1,627 and $1,080 as of June 30, 2003 and 2002, respectively | — | 547 | ||||||||
Other assets | 54 | 1,870 | ||||||||
Total assets | $ | 9,460 | $ | 49,467 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable – trade | $ | 3,199 | $ | 4,755 | ||||||
Short-term borrowings | — | 1,359 | ||||||||
Royalties payable | 1,242 | 528 | ||||||||
Obligations under capital leases – short-term portion | 27 | — | ||||||||
Accrued compensation and related benefits | 785 | 972 | ||||||||
Accrued software costs | 128 | 1,488 | ||||||||
Accrued expenses – other | 793 | 1,509 | ||||||||
Total current liabilities | 6,174 | 10,611 | ||||||||
Obligations under capital leases – long-term portion | 26 | — | ||||||||
Stockholders’ equity: | ||||||||||
Common stock $0.001 par value; shares authorized; 100,000,000; shares issued and outstanding:14,678,290 and 14,582,756 as of June 30, 2003 and 2002, respectively | 15 | 15 | ||||||||
Additional paid-in capital | 62,986 | 62,988 | ||||||||
Deferred stock compensation | (245 | ) | (789 | ) | ||||||
Accumulated deficit | (59,811 | ) | (23,618 | ) | ||||||
Accumulated other comprehensive income | 315 | 260 | ||||||||
Total stockholders’ equity | 3,260 | 38,856 | ||||||||
Total liabilities and stockholders’ equity | $ | 9,460 | $ | 49,467 | ||||||
BAM! ENTERTAINMENT, INC. AND SUBSIDIARIES
QUARTERLY FACT SHEET
(Dollars in thousands)
(Unaudited)
Percentage | |||||||||||||
of sales for | |||||||||||||
the three months | |||||||||||||
Three months ended | ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2003 | 2002 | 2003 | |||||||||||
Geographic sales mix | |||||||||||||
North America | $ | 2,502 | $ | 12,968 | 119.3 | % | |||||||
International | (405 | ) | 1,008 | (19.3 | ) | ||||||||
Total net revenues | $ | 2,097 | $ | 13,976 | 100.0 | % | |||||||
Platform revenue mix | |||||||||||||
PlayStation 2 | $ | 828 | $ | 8,417 | 39.5 | % | |||||||
GameCube | (133 | ) | 1,231 | (6.3 | ) | ||||||||
Xbox | 78 | — | 3.7 | ||||||||||
Gameboy Advance | 966 | 2,341 | 46.1 | ||||||||||
Gameboy Color | (7 | ) | 179 | (0.3 | ) | ||||||||
N64 | (4 | ) | 13 | (0.2 | ) | ||||||||
Personal Computer | 104 | 142 | 4.9 | ||||||||||
PlayStation 1 | 265 | 1,653 | 12.6 | ||||||||||
Total net revenues | $ | 2,097 | $ | 13,976 | 100.0 | % | |||||||