Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Jan. 31, 2022 | Mar. 14, 2022 | |
Document Information Line Items | ||
Entity Registrant Name | IDW MEDIA HOLDINGS, INC. | |
Trading Symbol | IDW | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --10-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0001463833 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Jan. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Shell Company | false | |
Entity Ex Transition Period | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-4831346 | |
Entity Address, Address Line One | 520 Broad Street | |
Entity Address, City or Town | Newark | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07102 | |
Title of 12(b) Security | Class B common stock, $0.01 par value; authorized shares | |
Security Exchange Name | NYSEAMER | |
Entity Interactive Data Current | Yes | |
City Area Code | 973 | |
Entity File Number | 001-34355 | |
Local Phone Number | 438-3385 | |
Class B Common Stock | ||
Document Information Line Items | ||
Entity Common Stock, Shares Outstanding | 12,430,676 | |
Class C Common Stock | ||
Document Information Line Items | ||
Entity Common Stock, Shares Outstanding | 545,360 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 16,997 | $ 17,532 |
Trade accounts receivable, net | 3,989 | 5,431 |
Inventory | 2,922 | 3,090 |
Prepaid expenses | 1,777 | 2,270 |
Total current assets | 25,685 | 28,323 |
Non-current assets | ||
Property and equipment, net | 356 | 347 |
Right-of-use assets, net | 181 | 302 |
Intangible assets, net | 791 | 679 |
Goodwill | 199 | 199 |
Television costs, net | 1,589 | 1,487 |
Other assets | 62 | 61 |
Total assets | 28,863 | 31,398 |
Current liabilities: | ||
Trade accounts payable | 1,346 | 1,141 |
Accrued expenses | 2,318 | 3,197 |
Production costs payable | 150 | 2,010 |
Deferred revenue | 65 | 2,045 |
Operating lease obligations – current portion | 198 | 348 |
Total current liabilities | 4,077 | 8,741 |
Non-current liabilities | ||
Operating lease obligations – long term portion | 16 | 20 |
Total liabilities | 4,093 | 8,761 |
Stockholders’ equity (see note 3): | ||
Preferred stock, $.01 par value; authorized shares – 500; no shares issued at January 31, 2022 and October 31, 2021 | ||
Class B common stock, $0.01 par value; authorized shares – 20,000; 12,950 and 12,938 shares issued and 12,431 and 12,419 shares outstanding at January 31, 2022 and October 31, 2021, respectively | 123 | 123 |
Class C common stock, $0.01 par value; authorized shares – 2,500; 545 shares issued and outstanding at January 31, 2022 and October 31, 2021 | 5 | 5 |
Additional paid-in capital | 103,963 | 103,819 |
Accumulated deficit | (78,125) | (80,114) |
Treasury stock, at cost, consisting of 519 shares of Class B common stock at January 31, 2022 and October 31, 2021 | (1,196) | (1,196) |
Total stockholders’ equity | 24,770 | 22,637 |
Total liabilities and stockholders’ equity | $ 28,863 | $ 31,398 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares shares in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Preferred stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized shares | 500 | 500 |
Preferred stock, shares issued | ||
Class B Common Stock | ||
Common stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 20,000 | 20,000 |
Common stock, shares issued | 12,950 | 12,938 |
Common stock, shares outstanding | 12,431 | 12,419 |
Treasury stock, shares | 519 | 519 |
Class C Common Stock | ||
Common stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 2,500 | 2,500 |
Common stock, shares issued | 545 | 545 |
Common stock, shares outstanding | 545 | 545 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | |
Income Statement [Abstract] | ||
Revenues | $ 11,849 | $ 8,413 |
Costs and expenses: | ||
Direct cost of revenues | 4,790 | 9,233 |
Selling, general and administrative | 4,992 | 4,242 |
Depreciation and amortization | 83 | 59 |
Total costs and expenses | 9,865 | 13,534 |
Income (loss) from operations | 1,984 | (5,121) |
Interest expense, net | (10) | (13) |
Other income, net | 15 | |
Net income (loss) from continuing operations | 1,989 | (5,134) |
Net loss from discontinued operations | (1,121) | |
Net income (loss) | $ 1,989 | $ (6,255) |
Basic and diluted income (loss) per share (see note 2): | ||
Continuing operations (in Dollars per share) | $ 0.15 | $ (0.51) |
Discontinued operations, net (in Dollars per share) | (0.11) | |
Basic and diluted net income (loss) per share (in Dollars per share) | $ 0.15 | $ (0.62) |
Weighted-average number of shares used in the calculation of basic and diluted income (loss) per share: (in Shares) | 12,858 | 9,992 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 1,989 | $ (6,255) |
Foreign currency translation adjustments | (12) | |
Total comprehensive income (loss) | $ 1,989 | $ (6,267) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders’ Equity - USD ($) $ in Thousands | Class BCommon Stock | Class CCommon Stock | Additional Paid In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Treasury Stock, at Cost | Total |
Balance at Oct. 31, 2020 | $ 93 | $ 5 | $ 111,379 | $ (60) | $ (91,996) | $ (1,196) | $ 18,225 |
Balance (in Shares) at Oct. 31, 2020 | 9,987 | 545 | 519 | ||||
Stock based compensation | 64 | 64 | |||||
Issuance of common stock | $ 1 | 24 | 25 | ||||
Issuance of common stock (in Shares) | 21 | ||||||
Comprehensive loss | |||||||
Net income (loss) | (6,255) | (6,255) | |||||
Other comprehensive income | (12) | (12) | |||||
Total comprehensive loss | (12) | (6,255) | (6,267) | ||||
Balance at Jan. 31, 2021 | $ 94 | $ 5 | 111,467 | (72) | (98,251) | $ (1,196) | 12,047 |
Balance (in Shares) at Jan. 31, 2021 | 10,008 | 545 | 519 | ||||
Balance at Oct. 31, 2021 | $ 123 | $ 5 | 103,819 | (80,114) | $ (1,196) | 22,637 | |
Balance (in Shares) at Oct. 31, 2021 | 12,938 | 545 | 519 | ||||
Stock based compensation | 144 | 144 | |||||
Issuance of common stock | |||||||
Issuance of common stock (in Shares) | 12 | ||||||
Comprehensive loss | |||||||
Net income (loss) | 1,989 | 1,989 | |||||
Other comprehensive income | |||||||
Total comprehensive loss | 1,989 | 1,989 | |||||
Balance at Jan. 31, 2022 | $ 123 | $ 5 | $ 103,963 | $ (78,125) | $ (1,196) | $ 24,770 | |
Balance (in Shares) at Jan. 31, 2022 | 12,950 | 545 | 519 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | |
Operating activities: | ||
Net income (loss) | $ 1,989 | $ (6,255) |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 83 | 218 |
Amortization of finance leases | 92 | |
Bad debt recovery | (109) | |
Stock based compensation | 144 | 64 |
Amortization of right-of-use asset | 121 | 358 |
Gain on extinguishment of PPP Loans | (68) | |
Changes in operating assets and liabilities: | ||
Trade accounts receivable | 1,442 | 3,786 |
Inventory | 168 | 159 |
Prepaid expenses and other assets | 492 | (229) |
Television costs | (102) | 1,839 |
Operating lease liability | (154) | (367) |
Trade accounts payable, accrued expenses, production costs payable and other current liabilities | (2,534) | 2,091 |
Deferred revenue | (1,980) | (693) |
Net cash (used in) provided by operating activities | (331) | 886 |
Investing activities: | ||
Capital expenditures | (204) | (55) |
Net cash used in investing activities | (204) | (55) |
Financing activities: | ||
Proceeds from issuance of common stock | 25 | |
Repayments of finance lease obligations | (92) | |
Proceeds from CTM bank loans | 17 | |
Repayments of bank loans | (3,076) | |
Net cash used in financing activities | (3,126) | |
Effect of exchange rate changes on cash and cash equivalents | (12) | |
Net decrease in cash and cash equivalents | (535) | (2,307) |
Cash and cash equivalents at beginning of period | 17,532 | 12,162 |
Cash and cash equivalents at end of period | 16,997 | 9,855 |
Supplemental schedule of investing and financing activities | ||
Cash paid for interest | $ 11 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Jan. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 1—Basis of Presentation and Summary of Significant Accounting Policies Overview IDW Media Holdings, Inc. (“IDWMH”) together with its subsidiaries (collectively, the “Company”) is a diversified media company with operations in publishing and television entertainment. The terms “Company,” “we,” “us,” and “our” are used in this report to refer collectively to the parent company and the subsidiaries through which various businesses are conducted. Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all information and footnotes required by U.S. GAAP for complete financial statements. Certain information and footnote disclosures normally included in our annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting principally of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results of operations are not necessarily indicative of the results for the full year or for any future period. These financial statements should be read in conjunction with the annual consolidated financial statements and notes thereto also included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2021. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. All amounts in these condensed consolidated financial statements and notes to the condensed consolidated financial statements are reflected on a consolidated basis for all periods presented. The Company’s fiscal year ends on October 31 st Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results may differ from those estimates. In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The Company is actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential impact on each of our operating segments. While we believe that in fiscal 2021 through the first quarter of fiscal 2022, there has been significant improvement due to global and domestic vaccination efforts, there is uncertainty around the duration and ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and our operations and our customers and partners may continue to be impacted. The Company has considered information available to it as of the date of issuance of these condensed consolidated financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgements, or an adjustment to the carrying value of its assets or liabilities. The accounting estimates and other matters assessed include, but were not limited to, goodwill and other long-lived assets, and revenue recognition. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates. Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 280 (“ASC 280”), Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial performance and the results of operations of the segments prepared in accordance with U.S. GAAP when making decisions about allocating resources and assessing performance of the Company (see note 5) Our principal business consist of the following segments: i. IDWP Publishing (“IDWP”), a publishing company that creates comic books, graphic novels, digital content and games through its imprints IDW, IDW Games, Top Shelf Productions and Artist’s Editions; and ii. IDW Entertainment (“IDWE”), a production company and studio that develops, produces and distributes content based on IDWP’s original IP for a variety of formats including film and television. Prior to February 15, 2021, we also owned CTM Media Group (CTM), a company that develops and distributes print and digital-based advertising and information advertising for tourist destinations in targeted tourist markets in 32 states / provinces in the US and Canada. On February 15, 2021, we consummated the sale of CTM to an assignee of Howard Jonas, the Company’s Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness we owed to our Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the sale, and (iii) a contingent payment if CTM is sold within 36 months of the sale for more than $4.5 million. As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the condensed consolidated financial statements as discontinued operations (Note 14 Discontinued Operations). Trade Accounts Receivable, Net Trade accounts receivables are recorded at the invoiced amount and are generally unsecured as they are uncollateralized. The Company provides an allowance for doubtful accounts to reduce receivables to their estimated net realizable value. Judgement is exercised in establishing allowances and estimates are based on the tenants’ payment history and liquidity. Any amounts that were previously recognized as revenue and subsequently determined to be uncollectible are charged to bad debt expense included in selling, general and administrative expense in the accompanying condensed consolidated statements of operations. The Company had an allowance for doubtful accounts of $0 as of January 31, 2022 and October 31, 2021. Television Costs We expense television production, participation and residual costs over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total revenues (Ultimate Revenues) for each production. If our estimate of Ultimate Revenues decreases, amortization of film and television costs may be accelerated. Conversely, if our estimate of Ultimate Revenues increases, film and television cost amortization may be slowed. For television series, Ultimate Revenues include revenues that are expected to be earned within ten years from delivery of the first episode, or if still in production, five years from delivery of the most recent episode, if later. IDWE capitalized cost of production and amortized it over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total Ultimate Revenues for each production. Advertising, marketing, general and administrative costs are expensed as incurred. Every quarter, the Company prepares analyses to support its content amortization expense. Critical assumptions used in determining content amortization include: (i) determining the grouping of contents (ii) the application of an ultimate revenue forecast model based on the contracts of televisions, (iii) gathering the schedules of delivered television episodes from the relative customers, (iv) calculating current period amortization, (v) assessing the accuracy of the Company’s forecasts. The Company continually reviews its estimates and contracts and revises its assumptions if necessary. Any material adjustments from the Company’s review of the amortization are applied prospectively in the period of the change for assets. With respect to television series or other television productions intended for broadcast, the most sensitive factors affecting estimates of Ultimate Revenues are program ratings and the strength of the advertising market. Program ratings, which are an indication of market acceptance, directly affect the Company’s ability to generate advertising revenues during the airing of the program. Television development costs for projects that have been abandoned or have not been set for production within three years are generally written off in the relevant period. Television costs are stated at the lower of cost less accumulated amortization or fair value. The Company evaluates impairment by the fair value of television costs at the individual level by considering expected future revenue generation, when an event or change in circumstances indicates a change in the expected revenue of the television costs or that the fair value of a film or film group may be less than unamortized costs. IDWE regularly enters into agreements for the production of its television shows. The agreements provide for the rights and obligations related to the agreement including timing, delivery and payments. IDWE capitalizes the resulting production costs under the agreements in production cost inventory as payments are made or when the products or services are delivered. Amortization of television costs during the three months ended January 31, 2022 and 2021 were $999,000 and $3,956,0000, respectively. Variable Interest Entities The Company, through its subsidiary IDWE has arrangements with seven special-purpose entities (“SPEs”), some formed for the sole purpose of providing production services in Canada for the production of a television pilot and television series, others for production and writing purposes. The SPEs are independently owned companies that are effectively controlled by IDWE and are parties to the related bank production financing arrangements. The Company has determined that SPEs are variable interest entities (“VIEs”) and that the Company is the primary beneficiary of the SPEs activities and obligor on the SPEs’ debt. All financial activity of the SPEs have been included IDWE’s financial statements, which are part of these consolidated financial statements. IDWE does not need to provide any support to the VIE’s and therefore there are no foreseen potential losses associated. They have finished all of the productions and these shows have been delivered. The outstanding loans have been paid off. The carrying amounts and classification of the VIEs’ assets are presented below: (in thousands) January 31, October 31, Cash and cash equivalents $ 192 $ 78 Revenue Recognition The Company applies the five-step approach as described in ASC 606, Revenue from Contracts with Customers, which consists of the following: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when (or as) the entity satisfies a performance obligation. IDWP generates revenue primarily from the sale and licensing of comic books, graphic novels, digital content, and games through IDWP’s imprints IDW Publishing, IDW Games and Top Shelf. Revenue from the direct sale of comic books, graphic novels and games is recognized, net of an allowance for estimated sales returns, at the time of shipment of its graphic novels, comic books and games by IDWP’s distributor to its customers. Licensing revenues are recognized upon execution of the agreement for such rights, and other creative revenues are recognized upon completion of services rendered on a contractual basis. IDWE generates revenue primarily from the licensing and distribution of content across various platforms and formats to audiences globally including television series and films. IDWE’s revenue is recognized when evidence of a sale or licensing arrangement exists, the product is complete, has been delivered or is available for immediate and unconditional delivery, the license period has begun, the fee is fixed or determinable, and collection is reasonably assured. IDWE enters into production agreements which provide for the rights and obligations related to the agreement including timing, delivery and payments. In certain productions, IDWE chooses to have the obligation to pay the Writers Guild of America (“WGA”) residuals for the creative writers of content. These extend to 25 years after distribution and are recorded in the consolidated statements of operations as a direct cost of revenue. In addition, IDWE has the right to receive participation rights recoupment based on viewership of the cumulative production. The Company is unable to make an estimate as the recoupment is based on future viewership and therefore revenue will be recognized at a future date once the amount is known. IDWE’s production activities included some of those provided by Canadian SPEs, and some of those productions qualify for tax credits in Canada. These credits are recorded as reductions in production cost when the SPEs becomes entitled to the Canadian tax credits. The Canada Revenue Agency (“CRA”) has completed the audit on these productions and the related tax refunds are no longer estimates. There are possible additional tax credits the Company may be eligible to receive, however due to the uncertainty of the receipt they have not been accrued for. The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the satisfaction of performance obligations, the Company records a contract liability on the balance sheets within deferred revenue until the performance obligations are satisfied. In the ordinary course of business, the Company’s reportable segments enter into transactions with one another. The most common types of intersegment transactions include IDWE obtaining rights to produce television series based on content created by IDWP. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues are eliminated in consolidation and, therefore, do not affect consolidated results. Revenue Recognition When Right of Return Exists IDWP offers its book market distributors, a right of return with no expiration date in accordance with general industry practices. These distributors then offer this same right of return to their book market retail customers. Sales returns allowances represent a reserve for IDWP products that may be returned due to dating, competition or other marketing matters, or certain destruction in the field. Sales returns are generally estimated and recorded based on historical sales and returns experience and current trends that are expected to continue. As of January 31, 2022 and October 31, 2021, the Company’s accrual for estimated returns were $91,000 and $127,000, respectively. Direct Cost of Revenues Direct cost of revenues excludes depreciation and non-production cost amortization expense. Direct cost of revenues for IDWP consists primarily of printing expenses and costs of artist and writers. Direct cost of revenues for IDWE consists primarily of the amortization of production costs that were capitalized during the production of the television episodes, accrued third party participation, and distribution fees directly related to revenue. Deferred Revenue The Company records deferred revenue upon invoicing for contracted commitments for products and services. Revenue is recognized on the date such product or service is provided or delivered in accordance with the contract. Concentration Risks Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, short term investment and trade accounts receivable. The Company holds cash and cash equivalents at several major financial institutions, which often exceed FDIC insurance limits. Historically, the Company has not experienced any losses due to such concentration of credit risk. The Company’s temporary cash investments policy is to limit the dollar amount of investments with any one financial institution and monitor the credit ratings of those institutions. While the Company may be exposed to credit losses due to the nonperformance of its counterparties, the Company does not expect the settlement of these transactions to have a material effect on its results of operations, cash flows or financial condition. IDWP has two significant customers Penguin Random House Publisher Services (“PRHPS”) and Diamond Comic Distributors, Inc. (“Diamond”), that pose a concentration risk. Revenues from PRHPS, IDWP’s non-direct market distributor, represented 21.7% and 28.2% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. The receivable balances from PRHPS represented 52.9% and 52.0% of condensed consolidated receivables at January 31, 2022 and October 31, 2021, respectively. Beginning June 1, 2022, PRHPS will replace Diamond as IDWP’s distributor to the direct market. Revenues from Diamond, IDWP’s direct market distributor, represented 15.0% and 27.3% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. The receivable balances from Diamond represented 18.9% and 20.0% of condensed consolidated receivables at January 31, 2022 and October 31, 2021, respectively. IDWE has two significant customers, Netflix and NBC Universal/SyFy, that pose a concentration risk. Revenues from Netflix, a leading streaming video subscription service, represented 35.4% and 0.0% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. Revenues from NBC Universal/SyFy, a major television network, represented 0% and 29.4% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. Discontinued Operations CTM meets the criteria for discontinued operations and has been presented as such in the condensed consolidated financial statements. In accordance with ASU 2014-08, “Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity,” a disposal is categorized as a discontinued operation if the disposal group is a component of an entity or group of components that meets the held for sale criteria, is disposed of by sale, or is disposed of other than by sale, and represents a strategic shift that has or will have a major effect on an entity’s operations and financial results . During the period in which the discontinued operation was classified as held for sale, the net loss was reclassified as a separate line item in the Condensed Consolidated Statement of Operations. Assets and liabilities are also separately reclassified in the balance sheet for all periods presented, prior to the sale. CTM’s assets are no longer reflected on the condensed consolidated financial statements for the periods following the CTM Sale Date. Cash flows from a discontinued operation and the continuing business are presented together without separate identification within cash flows from operating, investing and financing activities. Cash flows of CTM’s depreciation, amortization, capital expenditures and significant noncash operating and investing activities for the discontinued operation are presented separately. Reclassification of prior year presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications have not resulted in impacts to net loss. Stock options have been included with stock-based compensation on the Condensed Consolidated Statements of Stockholders’ Equity and Condensed Consolidated Statement of Cash Flows. Recently Issued Accounting Pronouncements Adopted In March 2019, the FASB issued Accounting Standard Update (“ASU”) No. 2019-02, Improvements to Accounting for Costs of Films and License Agreements for Program Materials. ASU 2019-02 aligns the accounting for production costs of episodic television series with the accounting for production costs of films. It also requires an entity to test a film or license agreement within the scope of Subtopic 920-350 for impairment at the film group level, when the film or license agreement is predominantly monetized with other films and/or license agreements. The Company adopted this ASU on November 1, 2020 and is applying its provisions prospectively. In connection with this adoption the Company has evaluated this guidance and determined that there are impairments (Note 11) from substantively abandoned television costs which materially impacted the consolidated financial statements. These costs were recorded in direct cost of revenues. In December 2019, the FASB issued ASC Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. Recently Issued Accounting Standard Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326), that changes the impairment model for most financial assets and certain other instruments. For receivables, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses in a manner similar to current practice, except the losses will be recognized as allowances instead of reductions in the amortized cost of the securities. In addition, an entity will have to disclose significantly more information about allowances, credit quality indicators and past due securities. The new guidance becomes effective for fiscal years beginning after December 15, 2022, though early adoption is permitted. The new provisions will be applied as a cumulative-effect adjustment to retained earnings. The Company will adopt the new standard on November 1, 2023. The Company is evaluating the impact that the new standard will have on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Jan. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 2—Earnings Per Share Basic earnings (loss) per share is computed by dividing net income (loss) attributable to all classes of common stockholders by the weighted average number of shares of all classes of common stock outstanding during the applicable period. Diluted earnings (loss) per share is computed in the same manner as basic income (loss) per share except that the number of shares is increased to include additional shares that would have been outstanding had the potentially dilutive shares been issued, and reduced by the number of shares the Company could have repurchased with the proceeds from issuance of the potentially dilutive shares using the treasury stock method, unless the effect of such increase would be anti-dilutive. The Company excluded 77,665 and 48,000 shares of unvested restricted Class B common stock, options to purchase 930,959 and 242,735 shares of Class B common stock, and warrants to purchase 187,579 and 187,579 shares of Class B common stock from the calculation of diluted loss per share for the three months ended January 31, 2022 and 2021, respectively, as the effect would have been anti-dilutive. Therefore, basic and diluted earnings per share are the same for the three months ended January 31, 2022 and 2021. |
Equity
Equity | 3 Months Ended |
Jan. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Equity | Note 3—Equity On July 14, 2021 the number of authorized shares of the Company’s Class B common stock was increased from 12,000,000 to 20,000,000. Voting Privileges and Protective Features Each holder of outstanding shares of Class B common stock is entitled to cast the number of votes equal to one tenth of the whole shares of Class B common stock held by such holder. Each holder of outstanding shares of Class C common stock is entitled to cast the number of votes equal to three times the whole shares of Class C common stock held by such holder. Each series of preferred stock, if any are designated and issued, will have such number of shares, designations, preferences, voting powers, qualifications and special or relative rights or privileges as shall be determined by our Board of Directors, which may include, among others, dividends, voting rights, and liquidation preferences. Restricted Stock The fair value of restricted shares of the Company’s Class B common stock is determined based on the closing price of the Company’s Class B common stock on the grant date. Share awards generally vest on a graded basis over three years of service. A summary of the status of the Company’s grants of restricted shares of Class B common stock is presented below: Number of Weighted Outstanding at October 31, 2021 85,999 $ 4.68 Granted 11,596 2.07 Vested (19,930 ) 2.85 Cancelled / Forfeited - - Non-vested shares at January 31, 2022 77,665 $ 4.76 At January 31, 2022, there was $301,000 of total unrecognized compensation cost related to non-vested stock-based compensation arrangements, which is expected to be recognized over the next 3 years. On December 31, 2020, 6,710 shares of Class B common stock were issued to our Chairman, for payment of interest on the loan agreement related to the related party loan that was paid off as of as part of the sale of CTM on February 15, 2021. (Note 14). Warrants Detailed below are outstanding warrants issued to our Chairman associated with the two loans made by the Chairman to the Company (which loans have subsequently been repaid): Number of Type of Share Exercise Price Expiration 98,336 Class B common stock $ 26.44 March 30, 2022 89,243 Class B common stock $ 42.02 August 21, 2023 |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Jan. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Stock Based Compensation | Note 4—Stock Based Compensation 2019 Incentive Plan On March 14, 2019, the Company’s Board of Directors adopted the 2019 IDW Stock Option and Incentive Plan (“2019 Incentive Plan”) to provide incentives to executive officers, employees, directors and consultants of the Company and/or its subsidiaries and reserved 300,000 shares of Class B common stock for the grant of awards under the 2019 Incentive Plan, subject to adjustment. Incentives available under the 2019 Incentive Plan may include stock options, stock appreciation rights, limited stock appreciation rights, restricted stock and deferred stock units. On July 13, 2020, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 450,000, subject to adjustment. On March 11, 2021, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 700,000, subject to adjustment. On November 8, 2021, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 1,350,000 subject to stockholder approval at the Company’s 2022 Annual Meeting of Stockholders. On January 13, 2022, the Board of Directors of the Company increased the number of shares of Class B common stock reserved for the grant of awards under the 2019 Incentive Plan to 2,550,000, subject to stockholder approval at the Company’s 2022 Annual Meeting of Stockholders. Options are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those options generally vest based on 3 years of continuous service and have 10-year contractual terms. As of January 31, 2022, 1,459,998 shares remained available to be awarded under the 2019 Incentive Plan. The following table summarizes stock option activity during the three months ended January 31, 2022. Number of Weighted Weighted Aggregate Outstanding at October 31, 2021 302,737 $ 5.69 8.56 $ - Granted 648,222 2.43 9.84 - Exercised - - - - Cancelled / Forfeited (20,000 ) 7.00 - - Outstanding at January 31, 2022 930,959 $ 3.39 9.46 $ - Exercisable at January 31, 2022 111,070 $ 7.72 8.18 $ - At January 31, 2022, unamortized stock compensation for stock options was $1,087,987. Non-cash compensation for stock options and restricted stock issued to employees and non-employees included in selling, general and administrative expenses for continuing operations was $144,000 and $64,000 during the three months ended January 31, 2022 and 2021, respectively. |
Business Segment Information
Business Segment Information | 3 Months Ended |
Jan. 31, 2022 | |
Segment Reporting [Abstract] | |
Business Segment Information | Note 5—Business Segment Information The Company has the following three reportable business segments: IDWP, IDWE and CTM (discontinued operations). The Company’s reportable segments are distinguished by types of service, customers and methods used to provide their services. The operating results of these business segments are regularly reviewed by the Company’s chief operating decision maker. The Company evaluates the performance of its business segments based primarily on operating income. The accounting policies of the segments are the same as the accounting policies of the Company as a whole. Total Assets (in thousands) January 31, 2022 for IDWP $12,788, IDWE $2,230 and IDWMH $13,845 Operating results for the business segments of the Company are as follows: (in thousands) IDWP IDWE(a) CTM IDWMH Total (discontinued (unallocated Three months ended January 31, 2022 Revenues $ 7,531 $ 4,318 $ - $ - $ 11,849 Income (loss) from operations 512 1,970 - (498 ) 1,984 Net income (loss) 512 1,985 - (508 ) 1,989 Three months ended January 31, 2021 Revenues $ 5,649 $ 2,764 $ - $ - $ 8,413 Income (loss) from operations (373 ) (4,553 ) - (195 ) (5,121 ) Loss from discontinued operations, net - - (1,121 ) - (1,121 ) Net income (loss) (373 ) (4,553 ) (1,121 ) (208 ) (6,255 ) (a) IDWE includes Thought Bubble LLC and Word Balloon LLC which consist of only television costs. |
Trade Accounts Receivable and D
Trade Accounts Receivable and Deferred Revenue | 3 Months Ended |
Jan. 31, 2022 | |
Receivables [Abstract] | |
Trade Accounts Receivable and Deferred Revenue | Note 6—Trade Accounts Receivable and Deferred Revenue Trade accounts receivable consists of the following: (in thousands) January 31, October 31, Trade accounts receivable $ 4,080 $ 5,558 Less allowance for sales returns (91 ) (127 ) Trade accounts receivable, net $ 3,989 $ 5,431 Changes in deferred revenue consist of the following: Three months ended (in thousands) January 31, Beginning Balance $ 2,045 Deferral of revenue 71 Recognition of deferred revenue (2,051 ) Return of previously collected funds - Ending Balance $ 65 The Company expects to satisfy its remaining performance obligations and recognize approximately 100% of this revenue over the next 12 months ending January 31, 2023. |
Inventory
Inventory | 3 Months Ended |
Jan. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 7—Inventory Inventory consists of the following: (in thousands) January 31, October 31, Work in progress $ 318 $ 495 Finished goods 2,604 2,595 Total $ 2,922 $ 3,090 |
Prepaid Expenses
Prepaid Expenses | 3 Months Ended |
Jan. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Prepaid Expenses | Note 8—Prepaid Expenses Prepaid expenses consist of the following: (in thousands) January 31, October 31, Royalties and deposits $ 1,189 $ 1,215 Insurance 191 225 Other prepaids 397 830 Total $ 1,777 $ 2,270 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Jan. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 9—Property and Equipment Property and equipment consist of the following: (in thousands) January 31, October 31, Equipment $ 600 $ 557 Furniture and Fixtures 106 106 Leasehold improvements 827 827 Computer software 28 24 Total 1561 1,514 Less accumulated depreciation (1,205 ) (1,167 ) Property and equipment, net $ 356 $ 347 Depreciation expense totaled $40,000 and $48,000 for the three months ended January 31, 2022 and 2021, respectively. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Jan. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 10—Intangible Assets Intangible assets consist of the following: January 31, 2022 (in thousands) Amortization Gross Additions Impairments Accumulated Net Book Value Amortized intangible assets: Licensing contracts 7 years $ 893 $ - $ - $ (893 ) $ - Software 5 years 672 32 (35 ) 669 1,565 32 - (928 ) 669 In-process intangible assets: Software development costs 122 - - - 122 122 - - - 122 Total $ 1,687 $ 32 $ - $ (928 ) $ 791 October 31, 2021 (in thousands) Amortization Gross Additions Impairments Accumulated Net Book Amortized intangible assets: Licensing contracts 7 years $ 893 $ - $ - $ (886 ) $ 7 893 - - (886 ) 7 In-process intangible assets: Software development costs - 672 - - 672 - 672 - - 672 Total $ 893 $ 672 $ - $ (886 ) $ 679 Amortization expense totaled $43,000 and $11,000 for the three months ended January 31, 2022 and 2021, respectively. |
Television Costs and Amortizati
Television Costs and Amortization | 3 Months Ended |
Jan. 31, 2022 | |
Television Costs And Amortization [Abstract] | |
Television costs and amortization | Note 11—Television costs and amortization Television costs consist of the following: (in thousands) January 31, October 31, In-production $ - $ - In-development 1,589 1,487 Total $ 1,589 $ 1,487 Three Months Ended (in thousands) 2022 2021 Television cost amortization $ 999 $ 3,956 Television cost impairments - 2,065 Total $ 999 $ 6,021 |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Jan. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Note 12—Accrued Expenses Accrued expenses consist of the following: (in thousands) January 31, October 31, Royalties $ 1,081 $ 1,410 Payroll, bonus, accrued vacation and payroll taxes 906 1,304 Other 331 483 Total $ 2,318 $ 3,197 |
Commitments
Commitments | 3 Months Ended |
Jan. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 13—Commitments Lease Commitments The Company has various lease agreements with remaining terms up to 3 years, including leases of office space, warehouses, and equipment. Some leases include options to purchase, terminate or extend for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised. The assets and liabilities from operating leases are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term leases, which have an initial term of 12 months or less, are not recorded on the balance sheet. The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, we use a discount rate based on our incremental borrowing rate, which is determined using the Company’s interest rate on its line of credit. The Company’s weighted-average remaining lease term relating to its operating leases is 0.549 years, with a weighted-average discount rate of 4.59% as of January 31, 2022. The Company recognized lease expense for its operating leases of $125,000 for the three months ended January 31, 2022 and 2021. The cash paid under operating leases was $157,000 and $143,000 for the three months ended January 31, 2022 and 2021, respectively. At January 31, 2022, the Company had a right-of-use-asset related to operating leases of $1,037,000, accumulated amortization related to operating leases of $856,000, both of which are included as a component of right-of-use assets. At October 31, 2021, the Company had a right-of-use-asset related to operating leases of $1,037,000 and accumulated amortization related to operating leases of $735,000. As of January 31, 2022, future minimum lease payments required under operating leases are as follows: Maturity of Lease Liability (in thousands) Total Fiscal years ending October 31: Rest of 2022 $ 197 2023 13 2024 7 2025 - Thereafter - Total minimum lease payments $ 217 Less: imputed interest (3 ) Present value of future minimum lease payments $ 214 |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Jan. 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Note 14—Discontinued Operations As a result of the economic downturn related to the outbreak of the COVID-19 virus, and the impact it had on small businesses in the tourist markets, the Company decided to make a strategic shift to dispose of CTM and to focus on its entertainment and publishing businesses. On February 15, 2021, pursuant to a sales and purchase agreement (“SPA”) dated as of July 14, 2020 IDWMH sold all of the stock of CTM to an assignee of the Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness owed by IDWMH to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date, and (iii) a contingent payment if CTM is sold within 36 months the CTM Sale Date for more than $4.5 million. Prior to executing the SPA, the Company obtained a third-party’s valuation of CTM and a fairness opinion that stated the consideration being received by the Company in the CTM Sale was fair. In addition to the Company’s Board of Directors approving the CTM Sale, the Audit Committee of the Board of Directors, which is comprised entirely of independent directors, approved the CTM Sale in compliance with the Company’s Statement of Policy with respect to Related Person Transactions. The CTM Sale was also approved by (1) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock and (2) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock not held by the Chairman or immediate family members of the Chairman, including, without limitation, trusts or other vehicles for the benefit of any of such immediate family members or entities under the control of such persons. On December 15, 2020, the right, title and interest to the SPA were assigned to The Brochure Distribution Trust, a South Dakota trust. Since the closing of the CTM Sale, the Company has not had any significant continuing involvement with CTM. As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the condensed consolidated financial statements as discontinued operations. On February 15, 2021, the Company closed the CTM Sale. The loan of $3,750,000 was forgiven in part of the sale and the Company recorded a gain of $2,123,219 based on CTM’s net asset value as of the CTM Sale Date. CTM’s assets are no longer reflected on the condensed consolidated financial statements for the periods following the CTM Sale Date and CTM’s operations are only consolidated in the Company’s condensed consolidated statements of operations results until the CTM Sale Date. There was no contingent gain recorded since there was no foreseeable contingent payments to the Company. Pursuant to ASC 205-20-45-9 general corporate overhead should not be allocated to discontinued operations. The Company did not allocate any corporate overhead to CTM when it began being classified as held for sale in the third quarter of 2020 and continued to not allocate any expenses. The consolidated statements of operations include the following results related to CTM discontinued operations: Results of discontinued operations Three months ended (in thousands) 2021 Revenue $ 1,219 Direct cost of revenue 840 Selling, general and administrative 1,422 Depreciation and amortization 250 Bad Debt (109 ) Total costs and expenses 2,403 Loss from operations (1,184 ) Interest expense, net (13 ) Other income (expense), net 76 Loss before income taxes (1,121 ) (Provision for) benefit from income taxes - Net loss $ (1,121 ) CTM’s depreciation and amortization, capital expenditures and notable activities for the discontinued operation include: Three months ended (in thousands) 2021 Depreciation and amortization $ 158 Amortization of finance lease 92 Amortization of right-of-use assets 242 Capital expenditure (22 ) Gain on extinguishment of PPP loan (68 ) |
Subsequent Events
Subsequent Events | 3 Months Ended |
Jan. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 15—Subsequent events The Company has evaluated subsequent events through March 14, 2022, the date on which the condensed consolidated financial statements were available to be issued. There were no material subsequent events that require recognition or additional disclosures in these condensed consolidated financial statements. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Jan. 31, 2022 | |
Accounting Policies [Abstract] | |
Overview | Overview IDW Media Holdings, Inc. (“IDWMH”) together with its subsidiaries (collectively, the “Company”) is a diversified media company with operations in publishing and television entertainment. The terms “Company,” “we,” “us,” and “our” are used in this report to refer collectively to the parent company and the subsidiaries through which various businesses are conducted. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all information and footnotes required by U.S. GAAP for complete financial statements. Certain information and footnote disclosures normally included in our annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting principally of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results of operations are not necessarily indicative of the results for the full year or for any future period. These financial statements should be read in conjunction with the annual consolidated financial statements and notes thereto also included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2021. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. All amounts in these condensed consolidated financial statements and notes to the condensed consolidated financial statements are reflected on a consolidated basis for all periods presented. The Company’s fiscal year ends on October 31 st |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results may differ from those estimates. In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The Company is actively monitoring the COVID-19 pandemic, the restrictive measures imposed to combat its spread and their potential impact on each of our operating segments. While we believe that in fiscal 2021 through the first quarter of fiscal 2022, there has been significant improvement due to global and domestic vaccination efforts, there is uncertainty around the duration and ongoing impact, if any, of COVID-19 related to both known and unknown risks, including future quarantines, closures and other restrictions resulting from the outbreak, and our operations and our customers and partners may continue to be impacted. The Company has considered information available to it as of the date of issuance of these condensed consolidated financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgements, or an adjustment to the carrying value of its assets or liabilities. The accounting estimates and other matters assessed include, but were not limited to, goodwill and other long-lived assets, and revenue recognition. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates. |
Segment Information | Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 280 (“ASC 280”), Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial performance and the results of operations of the segments prepared in accordance with U.S. GAAP when making decisions about allocating resources and assessing performance of the Company (see note 5) Our principal business consist of the following segments: i. IDWP Publishing (“IDWP”), a publishing company that creates comic books, graphic novels, digital content and games through its imprints IDW, IDW Games, Top Shelf Productions and Artist’s Editions; and ii. IDW Entertainment (“IDWE”), a production company and studio that develops, produces and distributes content based on IDWP’s original IP for a variety of formats including film and television. Prior to February 15, 2021, we also owned CTM Media Group (CTM), a company that develops and distributes print and digital-based advertising and information advertising for tourist destinations in targeted tourist markets in 32 states / provinces in the US and Canada. On February 15, 2021, we consummated the sale of CTM to an assignee of Howard Jonas, the Company’s Chairman in exchange for (i) the cancelation of $3.75 million of indebtedness we owed to our Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the sale, and (iii) a contingent payment if CTM is sold within 36 months of the sale for more than $4.5 million. As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the condensed consolidated financial statements as discontinued operations (Note 14 Discontinued Operations). |
Trade Accounts Receivable, Net | Trade Accounts Receivable, Net Trade accounts receivables are recorded at the invoiced amount and are generally unsecured as they are uncollateralized. The Company provides an allowance for doubtful accounts to reduce receivables to their estimated net realizable value. Judgement is exercised in establishing allowances and estimates are based on the tenants’ payment history and liquidity. Any amounts that were previously recognized as revenue and subsequently determined to be uncollectible are charged to bad debt expense included in selling, general and administrative expense in the accompanying condensed consolidated statements of operations. The Company had an allowance for doubtful accounts of $0 as of January 31, 2022 and October 31, 2021. |
Television Costs | Television Costs We expense television production, participation and residual costs over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total revenues (Ultimate Revenues) for each production. If our estimate of Ultimate Revenues decreases, amortization of film and television costs may be accelerated. Conversely, if our estimate of Ultimate Revenues increases, film and television cost amortization may be slowed. For television series, Ultimate Revenues include revenues that are expected to be earned within ten years from delivery of the first episode, or if still in production, five years from delivery of the most recent episode, if later. IDWE capitalized cost of production and amortized it over the applicable product life cycle based upon the ratio of the current period’s revenues to the estimated remaining total Ultimate Revenues for each production. Advertising, marketing, general and administrative costs are expensed as incurred. Every quarter, the Company prepares analyses to support its content amortization expense. Critical assumptions used in determining content amortization include: (i) determining the grouping of contents (ii) the application of an ultimate revenue forecast model based on the contracts of televisions, (iii) gathering the schedules of delivered television episodes from the relative customers, (iv) calculating current period amortization, (v) assessing the accuracy of the Company’s forecasts. The Company continually reviews its estimates and contracts and revises its assumptions if necessary. Any material adjustments from the Company’s review of the amortization are applied prospectively in the period of the change for assets. With respect to television series or other television productions intended for broadcast, the most sensitive factors affecting estimates of Ultimate Revenues are program ratings and the strength of the advertising market. Program ratings, which are an indication of market acceptance, directly affect the Company’s ability to generate advertising revenues during the airing of the program. Television development costs for projects that have been abandoned or have not been set for production within three years are generally written off in the relevant period. Television costs are stated at the lower of cost less accumulated amortization or fair value. The Company evaluates impairment by the fair value of television costs at the individual level by considering expected future revenue generation, when an event or change in circumstances indicates a change in the expected revenue of the television costs or that the fair value of a film or film group may be less than unamortized costs. IDWE regularly enters into agreements for the production of its television shows. The agreements provide for the rights and obligations related to the agreement including timing, delivery and payments. IDWE capitalizes the resulting production costs under the agreements in production cost inventory as payments are made or when the products or services are delivered. Amortization of television costs during the three months ended January 31, 2022 and 2021 were $999,000 and $3,956,0000, respectively. |
Variable Interest Entities | Variable Interest Entities The Company, through its subsidiary IDWE has arrangements with seven special-purpose entities (“SPEs”), some formed for the sole purpose of providing production services in Canada for the production of a television pilot and television series, others for production and writing purposes. The SPEs are independently owned companies that are effectively controlled by IDWE and are parties to the related bank production financing arrangements. The Company has determined that SPEs are variable interest entities (“VIEs”) and that the Company is the primary beneficiary of the SPEs activities and obligor on the SPEs’ debt. All financial activity of the SPEs have been included IDWE’s financial statements, which are part of these consolidated financial statements. IDWE does not need to provide any support to the VIE’s and therefore there are no foreseen potential losses associated. They have finished all of the productions and these shows have been delivered. The outstanding loans have been paid off. The carrying amounts and classification of the VIEs’ assets are presented below: |
Revenue Recognition | Revenue Recognition The Company applies the five-step approach as described in ASC 606, Revenue from Contracts with Customers, which consists of the following: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when (or as) the entity satisfies a performance obligation. IDWP generates revenue primarily from the sale and licensing of comic books, graphic novels, digital content, and games through IDWP’s imprints IDW Publishing, IDW Games and Top Shelf. Revenue from the direct sale of comic books, graphic novels and games is recognized, net of an allowance for estimated sales returns, at the time of shipment of its graphic novels, comic books and games by IDWP’s distributor to its customers. Licensing revenues are recognized upon execution of the agreement for such rights, and other creative revenues are recognized upon completion of services rendered on a contractual basis. IDWE generates revenue primarily from the licensing and distribution of content across various platforms and formats to audiences globally including television series and films. IDWE’s revenue is recognized when evidence of a sale or licensing arrangement exists, the product is complete, has been delivered or is available for immediate and unconditional delivery, the license period has begun, the fee is fixed or determinable, and collection is reasonably assured. IDWE enters into production agreements which provide for the rights and obligations related to the agreement including timing, delivery and payments. In certain productions, IDWE chooses to have the obligation to pay the Writers Guild of America (“WGA”) residuals for the creative writers of content. These extend to 25 years after distribution and are recorded in the consolidated statements of operations as a direct cost of revenue. In addition, IDWE has the right to receive participation rights recoupment based on viewership of the cumulative production. The Company is unable to make an estimate as the recoupment is based on future viewership and therefore revenue will be recognized at a future date once the amount is known. IDWE’s production activities included some of those provided by Canadian SPEs, and some of those productions qualify for tax credits in Canada. These credits are recorded as reductions in production cost when the SPEs becomes entitled to the Canadian tax credits. The Canada Revenue Agency (“CRA”) has completed the audit on these productions and the related tax refunds are no longer estimates. There are possible additional tax credits the Company may be eligible to receive, however due to the uncertainty of the receipt they have not been accrued for. The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the satisfaction of performance obligations, the Company records a contract liability on the balance sheets within deferred revenue until the performance obligations are satisfied. In the ordinary course of business, the Company’s reportable segments enter into transactions with one another. The most common types of intersegment transactions include IDWE obtaining rights to produce television series based on content created by IDWP. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues are eliminated in consolidation and, therefore, do not affect consolidated results. |
Revenue Recognition When Right of Return Exists | Revenue Recognition When Right of Return Exists IDWP offers its book market distributors, a right of return with no expiration date in accordance with general industry practices. These distributors then offer this same right of return to their book market retail customers. Sales returns allowances represent a reserve for IDWP products that may be returned due to dating, competition or other marketing matters, or certain destruction in the field. Sales returns are generally estimated and recorded based on historical sales and returns experience and current trends that are expected to continue. As of January 31, 2022 and October 31, 2021, the Company’s accrual for estimated returns were $91,000 and $127,000, respectively. |
Direct Cost of Revenues | Direct Cost of Revenues Direct cost of revenues excludes depreciation and non-production cost amortization expense. Direct cost of revenues for IDWP consists primarily of printing expenses and costs of artist and writers. Direct cost of revenues for IDWE consists primarily of the amortization of production costs that were capitalized during the production of the television episodes, accrued third party participation, and distribution fees directly related to revenue. |
Deferred Revenue | Deferred Revenue The Company records deferred revenue upon invoicing for contracted commitments for products and services. Revenue is recognized on the date such product or service is provided or delivered in accordance with the contract. |
Concentration Risks | Concentration Risks Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, short term investment and trade accounts receivable. The Company holds cash and cash equivalents at several major financial institutions, which often exceed FDIC insurance limits. Historically, the Company has not experienced any losses due to such concentration of credit risk. The Company’s temporary cash investments policy is to limit the dollar amount of investments with any one financial institution and monitor the credit ratings of those institutions. While the Company may be exposed to credit losses due to the nonperformance of its counterparties, the Company does not expect the settlement of these transactions to have a material effect on its results of operations, cash flows or financial condition. IDWP has two significant customers Penguin Random House Publisher Services (“PRHPS”) and Diamond Comic Distributors, Inc. (“Diamond”), that pose a concentration risk. Revenues from PRHPS, IDWP’s non-direct market distributor, represented 21.7% and 28.2% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. The receivable balances from PRHPS represented 52.9% and 52.0% of condensed consolidated receivables at January 31, 2022 and October 31, 2021, respectively. Beginning June 1, 2022, PRHPS will replace Diamond as IDWP’s distributor to the direct market. Revenues from Diamond, IDWP’s direct market distributor, represented 15.0% and 27.3% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. The receivable balances from Diamond represented 18.9% and 20.0% of condensed consolidated receivables at January 31, 2022 and October 31, 2021, respectively. IDWE has two significant customers, Netflix and NBC Universal/SyFy, that pose a concentration risk. Revenues from Netflix, a leading streaming video subscription service, represented 35.4% and 0.0% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. Revenues from NBC Universal/SyFy, a major television network, represented 0% and 29.4% of condensed consolidated revenue for the three months ended January 31, 2022 and 2021, respectively. |
Discontinued Operations | Discontinued Operations CTM meets the criteria for discontinued operations and has been presented as such in the condensed consolidated financial statements. In accordance with ASU 2014-08, “Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity,” a disposal is categorized as a discontinued operation if the disposal group is a component of an entity or group of components that meets the held for sale criteria, is disposed of by sale, or is disposed of other than by sale, and represents a strategic shift that has or will have a major effect on an entity’s operations and financial results . During the period in which the discontinued operation was classified as held for sale, the net loss was reclassified as a separate line item in the Condensed Consolidated Statement of Operations. Assets and liabilities are also separately reclassified in the balance sheet for all periods presented, prior to the sale. CTM’s assets are no longer reflected on the condensed consolidated financial statements for the periods following the CTM Sale Date. Cash flows from a discontinued operation and the continuing business are presented together without separate identification within cash flows from operating, investing and financing activities. Cash flows of CTM’s depreciation, amortization, capital expenditures and significant noncash operating and investing activities for the discontinued operation are presented separately. |
Reclassification of prior year presentation | Reclassification of prior year presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications have not resulted in impacts to net loss. Stock options have been included with stock-based compensation on the Condensed Consolidated Statements of Stockholders’ Equity and Condensed Consolidated Statement of Cash Flows. |
Recently Issued Accounting Pronouncements Adopted | Recently Issued Accounting Pronouncements Adopted In March 2019, the FASB issued Accounting Standard Update (“ASU”) No. 2019-02, Improvements to Accounting for Costs of Films and License Agreements for Program Materials. ASU 2019-02 aligns the accounting for production costs of episodic television series with the accounting for production costs of films. It also requires an entity to test a film or license agreement within the scope of Subtopic 920-350 for impairment at the film group level, when the film or license agreement is predominantly monetized with other films and/or license agreements. The Company adopted this ASU on November 1, 2020 and is applying its provisions prospectively. In connection with this adoption the Company has evaluated this guidance and determined that there are impairments (Note 11) from substantively abandoned television costs which materially impacted the consolidated financial statements. These costs were recorded in direct cost of revenues. In December 2019, the FASB issued ASC Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. |
Recently Issued Accounting Standard Not Yet Adopted | Recently Issued Accounting Standard Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326), that changes the impairment model for most financial assets and certain other instruments. For receivables, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses in a manner similar to current practice, except the losses will be recognized as allowances instead of reductions in the amortized cost of the securities. In addition, an entity will have to disclose significantly more information about allowances, credit quality indicators and past due securities. The new guidance becomes effective for fiscal years beginning after December 15, 2022, though early adoption is permitted. The new provisions will be applied as a cumulative-effect adjustment to retained earnings. The Company will adopt the new standard on November 1, 2023. The Company is evaluating the impact that the new standard will have on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of variable interest entities | (in thousands) January 31, October 31, Cash and cash equivalents $ 192 $ 78 |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of status of the company’s grants of restricted shares | Number of Weighted Outstanding at October 31, 2021 85,999 $ 4.68 Granted 11,596 2.07 Vested (19,930 ) 2.85 Cancelled / Forfeited - - Non-vested shares at January 31, 2022 77,665 $ 4.76 |
Schedule of outstanding warrants to related party loans | Number of Type of Share Exercise Price Expiration 98,336 Class B common stock $ 26.44 March 30, 2022 89,243 Class B common stock $ 42.02 August 21, 2023 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock option activity | Number of Weighted Weighted Aggregate Outstanding at October 31, 2021 302,737 $ 5.69 8.56 $ - Granted 648,222 2.43 9.84 - Exercised - - - - Cancelled / Forfeited (20,000 ) 7.00 - - Outstanding at January 31, 2022 930,959 $ 3.39 9.46 $ - Exercisable at January 31, 2022 111,070 $ 7.72 8.18 $ - |
Business Segment Information (T
Business Segment Information (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of operating results for the business segments | (in thousands) IDWP IDWE(a) CTM IDWMH Total (discontinued (unallocated Three months ended January 31, 2022 Revenues $ 7,531 $ 4,318 $ - $ - $ 11,849 Income (loss) from operations 512 1,970 - (498 ) 1,984 Net income (loss) 512 1,985 - (508 ) 1,989 Three months ended January 31, 2021 Revenues $ 5,649 $ 2,764 $ - $ - $ 8,413 Income (loss) from operations (373 ) (4,553 ) - (195 ) (5,121 ) Loss from discontinued operations, net - - (1,121 ) - (1,121 ) Net income (loss) (373 ) (4,553 ) (1,121 ) (208 ) (6,255 ) |
Trade Accounts Receivable and_2
Trade Accounts Receivable and Deferred Revenue (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Receivables [Abstract] | |
Schedule of trade accounts receivable | (in thousands) January 31, October 31, Trade accounts receivable $ 4,080 $ 5,558 Less allowance for sales returns (91 ) (127 ) Trade accounts receivable, net $ 3,989 $ 5,431 |
Schedule of changes in deferred revenue | Three months ended (in thousands) January 31, Beginning Balance $ 2,045 Deferral of revenue 71 Recognition of deferred revenue (2,051 ) Return of previously collected funds - Ending Balance $ 65 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | (in thousands) January 31, October 31, Work in progress $ 318 $ 495 Finished goods 2,604 2,595 Total $ 2,922 $ 3,090 |
Prepaid Expenses (Tables)
Prepaid Expenses (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Schedule of prepaid expenses | (in thousands) January 31, October 31, Royalties and deposits $ 1,189 $ 1,215 Insurance 191 225 Other prepaids 397 830 Total $ 1,777 $ 2,270 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment consist | (in thousands) January 31, October 31, Equipment $ 600 $ 557 Furniture and Fixtures 106 106 Leasehold improvements 827 827 Computer software 28 24 Total 1561 1,514 Less accumulated depreciation (1,205 ) (1,167 ) Property and equipment, net $ 356 $ 347 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | January 31, 2022 (in thousands) Amortization Gross Additions Impairments Accumulated Net Book Value Amortized intangible assets: Licensing contracts 7 years $ 893 $ - $ - $ (893 ) $ - Software 5 years 672 32 (35 ) 669 1,565 32 - (928 ) 669 In-process intangible assets: Software development costs 122 - - - 122 122 - - - 122 Total $ 1,687 $ 32 $ - $ (928 ) $ 791 October 31, 2021 (in thousands) Amortization Gross Additions Impairments Accumulated Net Book Amortized intangible assets: Licensing contracts 7 years $ 893 $ - $ - $ (886 ) $ 7 893 - - (886 ) 7 In-process intangible assets: Software development costs - 672 - - 672 - 672 - - 672 Total $ 893 $ 672 $ - $ (886 ) $ 679 |
Television Costs and Amortiza_2
Television Costs and Amortization (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Television Costs And Amortization [Abstract] | |
Schedule of television costs and amortization | (in thousands) January 31, October 31, In-production $ - $ - In-development 1,589 1,487 Total $ 1,589 $ 1,487 Three Months Ended (in thousands) 2022 2021 Television cost amortization $ 999 $ 3,956 Television cost impairments - 2,065 Total $ 999 $ 6,021 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | (in thousands) January 31, October 31, Royalties $ 1,081 $ 1,410 Payroll, bonus, accrued vacation and payroll taxes 906 1,304 Other 331 483 Total $ 2,318 $ 3,197 |
Commitments (Tables)
Commitments (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments required under operating leases | Maturity of Lease Liability (in thousands) Total Fiscal years ending October 31: Rest of 2022 $ 197 2023 13 2024 7 2025 - Thereafter - Total minimum lease payments $ 217 Less: imputed interest (3 ) Present value of future minimum lease payments $ 214 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Jan. 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of statements of operations including discontinued operations | Results of discontinued operations Three months ended (in thousands) 2021 Revenue $ 1,219 Direct cost of revenue 840 Selling, general and administrative 1,422 Depreciation and amortization 250 Bad Debt (109 ) Total costs and expenses 2,403 Loss from operations (1,184 ) Interest expense, net (13 ) Other income (expense), net 76 Loss before income taxes (1,121 ) (Provision for) benefit from income taxes - Net loss $ (1,121 ) |
Schedule of cash flows | Three months ended (in thousands) 2021 Depreciation and amortization $ 158 Amortization of finance lease 92 Amortization of right-of-use assets 242 Capital expenditure (22 ) Gain on extinguishment of PPP loan (68 ) |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | Oct. 31, 2021 | |
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Exchange to chairman, description | As of July 31, 2020, CTM was reported as a discontinued operation and CTM’s operations have since been included in the condensed consolidated financial statements as discontinued operations (Note 14 Discontinued Operations). | ||
Allowance for doubtful accounts (in Dollars) | $ 0 | $ 0 | |
Amortization of television costs (in Dollars) | $ 999,000 | ||
After distribution and recorded period | 25 years | ||
Accrual for estimated lases returns (in Dollars) | $ 91,000 | $ 127,000 | |
PRHPS [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Concentration risks, percentage | 21.70% | 28.20% | |
Diamond [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Concentration risks, percentage | 15.00% | 27.30% | |
Trade Accounts Receivable [Member] | PRHPS [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Trade accounts receivable percentage | 52.90% | 52.00% | |
Trade Accounts Receivable [Member] | Diamond [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Consolidated receivables percentage | 18.90% | 20.00% | |
Total Condensed Consolidated Revenues [Member] | Netflix [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Concentration risks, percentage | 35.40% | 0.00% | |
Total Condensed Consolidated Revenues [Member] | NBC Universal/SyFy [Member] | |||
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items] | |||
Concentration risks, percentage | 0.00% | 29.40% |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies (Details) - Schedule of variable interest entities - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Variable Interest Entity, Primary Beneficiary [Member] | VIEs [Member] | ||
Variable Interest Entity [Line Items] | ||
Cash and cash equivalents | $ 192 | $ 78 |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares | 3 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Unvested restricted stock | 77,665 | 48,000 |
Unvested restricted stock options | 930,959 | 242,735 |
Warrants | 187,579 | 187,579 |
Equity (Details)
Equity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |
Dec. 31, 2020 | Jan. 31, 2022 | Jul. 14, 2021 | |
Equity (Details) [Line Items] | |||
Unrecognized compensation (in Dollars) | $ 301,000 | ||
Stock-based compensation arrangements expected recognized | 3 years | ||
Chairman [Member] | |||
Equity (Details) [Line Items] | |||
Share issued | 6,710 | ||
Class B Common Stock [Member] | Minimum [Member] | |||
Equity (Details) [Line Items] | |||
Shares authorized | 12,000,000 | ||
Class B Common Stock [Member] | Maximum [Member] | |||
Equity (Details) [Line Items] | |||
Shares authorized | 20,000,000 |
Equity (Details) - Schedule of
Equity (Details) - Schedule of status of the company's grants of restricted shares | 3 Months Ended |
Jan. 31, 2022$ / sharesshares | |
Schedule of status of the company's grants of restricted shares [Abstract] | |
Number of Non-vested Shares, Outstanding | shares | 85,999 |
Weighted Average Grant Date Fair Value, Outstanding | $ / shares | $ 4.68 |
Number of Non-vested Shares, Granted | shares | 11,596 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 2.07 |
Number of Non-vested Shares, Vested | shares | (19,930) |
Weighted Average Grant Date Fair Value, Vested | $ / shares | $ 2.85 |
Number of Non-vested Shares, Cancelled / Forfeited | shares | |
Weighted Average Grant Date Fair Value, Cancelled / Forfeited | $ / shares | |
Number of Non-vested Shares, Non-vested shares | shares | 77,665 |
Weighted Average Grant Date Fair Value, Non-vested shares | $ / shares | $ 4.76 |
Equity (Details) - Schedule o_2
Equity (Details) - Schedule of outstanding warrants to related party loans - Class B - Common Stock [Member] | 3 Months Ended |
Jan. 31, 2022$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Number of Shares | shares | 98,336 |
Type of Share | Class B common stock |
Exercise Price | $ / shares | $ 26.44 |
Expiration | Mar. 30, 2022 |
Number of Shares | shares | 89,243 |
Type of Share | Class B common stock |
Exercise Price | $ / shares | $ 42.02 |
Expiration | Aug. 21, 2023 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - USD ($) | Jul. 13, 2020 | Mar. 14, 2019 | Jan. 31, 2022 | Jan. 31, 2021 | Jan. 13, 2022 | Nov. 08, 2021 | Mar. 11, 2021 |
Stock Based Compensation (Details) [Line Items] | |||||||
Vesting period | 3 years | ||||||
Contractual terms | 10 years | ||||||
Unamortized stock compensation for stock options (in Dollars) | $ 1,087,987 | ||||||
General and administrative expenses (in Dollars) | $ 144,000 | $ 64,000 | |||||
Class B Common Stock [Member] | |||||||
Stock Based Compensation (Details) [Line Items] | |||||||
Options granted | 300,000 | ||||||
Class B Common Stock [Member] | 2019 Incentive Plan [Member] | |||||||
Stock Based Compensation (Details) [Line Items] | |||||||
Reserved grant of awards subject to adjustment | 450,000 | 1,459,998 | |||||
Reserved shares | 2,550,000 | 1,350,000 | 700,000 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details) - Schedule of stock option activity | 3 Months Ended |
Jan. 31, 2022USD ($)$ / sharesshares | |
Schedule of stock option activity [Abstract] | |
Beginning, Number of Options | shares | 302,737 |
Beginning, Weighted Average Exercise Price | $ / shares | $ 5.69 |
Beginning, Weighted Average Remaining Contractual Term (in years) | 8 years 6 months 21 days |
Beginning, Aggregate Intrinsic Value (in thousands) | $ | |
Granted, Number of Options | shares | 648,222 |
Granted, Weighted Average Exercise Price | $ / shares | $ 2.43 |
Granted, Weighted Average Remaining Contractual Term (in years) | 9 years 10 months 2 days |
Granted, Aggregate Intrinsic Value (in thousands) | $ | |
Exercised, Number of Options | shares | |
Exercised, Weighted Average Exercise Price | $ / shares | |
Exercised, Weighted Average Remaining Contractual Term (in years) | |
Exercised, Aggregate Intrinsic Value (in thousands) | $ | |
Cancelled / Forfeited, Number of Options | shares | (20,000) |
Cancelled / Forfeited, Weighted Average Exercise Price | $ / shares | $ 7 |
Cancelled / Forfeited, Weighted Average Remaining Contractual Term (in years) | |
Cancelled / Forfeited, Aggregate Intrinsic Value (in thousands) | $ | |
Ending, Number of Options | shares | 930,959 |
Ending, Weighted Average Exercise Price | $ / shares | $ 3.39 |
Ending, Weighted Average Remaining Contractual Term (in years) | 9 years 5 months 15 days |
Ending, Aggregate Intrinsic Value (in thousands) | $ | |
Exercisable, Number of Options | shares | 111,070 |
Exercisable, Weighted Average Exercise Price | $ / shares | $ 7.72 |
Exercisable, Weighted Average Remaining Contractual Term (in years) | 8 years 2 months 4 days |
Exercisable, Aggregate Intrinsic Value (in thousands) | $ |
Business Segment Information (D
Business Segment Information (Details) - Business Combination [Member] $ in Thousands | 3 Months Ended |
Jan. 31, 2022USD ($) | |
IDWP [Member] | |
Business Segment Information (Details) [Line Items] | |
Total Assets | $ 12,788 |
IDWE [Member] | |
Business Segment Information (Details) [Line Items] | |
Total Assets | 2,230 |
IDWMH [Member] | |
Business Segment Information (Details) [Line Items] | |
Total Assets | $ 13,845 |
Business Segment Information _2
Business Segment Information (Details) - Schedule of operating results for the business segments - USD ($) $ in Thousands | 3 Months Ended | ||
Jan. 31, 2022 | Jan. 31, 2021 | ||
Segment Reporting Information [Line Items] | |||
Revenues | $ 11,849 | $ 8,413 | |
Income (loss) from operations | 1,984 | (5,121) | |
Net income (loss) | 1,989 | (6,255) | |
Three months ended January 31, 2021 | |||
Loss from discontinued operations, net | (1,121) | ||
IDWP [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 7,531 | 5,649 | |
Income (loss) from operations | 512 | (373) | |
Net income (loss) | 512 | (373) | |
Three months ended January 31, 2021 | |||
Loss from discontinued operations, net | |||
IDWE [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [1] | 4,318 | 2,764 |
Income (loss) from operations | [1] | 1,970 | (4,553) |
Net income (loss) | [1] | 1,985 | (4,553) |
Three months ended January 31, 2021 | |||
Loss from discontinued operations, net | [1] | ||
CTM [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | |||
Income (loss) from operations | |||
Net income (loss) | (1,121) | ||
Three months ended January 31, 2021 | |||
Loss from discontinued operations, net | (1,121) | ||
IDWMH [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | |||
Income (loss) from operations | (498) | (195) | |
Net income (loss) | $ (508) | (208) | |
Three months ended January 31, 2021 | |||
Loss from discontinued operations, net | |||
[1] | IDWE includes Thought Bubble LLC and Word Balloon LLC which consist of only television costs. |
Trade Accounts Receivable and_3
Trade Accounts Receivable and Deferred Revenue (Details) | Jan. 31, 2023 |
Forecast [Member] | |
Trade Accounts Receivable and Deferred Revenue (Details) [Line Items] | |
Performance obligations on deferred revenue, percentage | 100.00% |
Trade Accounts Receivable and_4
Trade Accounts Receivable and Deferred Revenue (Details) - Schedule of trade accounts receivable - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Schedule of trade accounts receivable [Abstract] | ||
Trade accounts receivable | $ 4,080 | $ 5,558 |
Less allowance for sales returns | (91) | (127) |
Trade accounts receivable, net | $ 3,989 | $ 5,431 |
Trade Accounts Receivable and_5
Trade Accounts Receivable and Deferred Revenue (Details) - Schedule of changes in deferred revenue $ in Thousands | 3 Months Ended |
Jan. 31, 2022USD ($) | |
Schedule of changes in deferred revenue [Abstract] | |
Beginning Balance | $ 2,045 |
Deferral of revenue | 71 |
Recognition of deferred revenue | (2,051) |
Return of previously collected funds | |
Ending Balance | $ 65 |
Inventory (Details) - Schedule
Inventory (Details) - Schedule of inventory - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Schedule of inventory [Abstract] | ||
Work in progress | $ 318 | $ 495 |
Finished goods | 2,604 | 2,595 |
Total | $ 2,922 | $ 3,090 |
Prepaid Expenses (Details) - Sc
Prepaid Expenses (Details) - Schedule of prepaid expenses - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Schedule of prepaid expenses [Abstract] | ||
Royalties and deposits | $ 1,189 | $ 1,215 |
Insurance | 191 | 225 |
Other prepaids | 397 | 830 |
Total | $ 1,777 | $ 2,270 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Jan. 31, 2022 | Oct. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 40,000 | $ 48,000 |
Property and Equipment (Detai_2
Property and Equipment (Details) - Schedule of property and equipment consist - USD ($) $ in Thousands | Jan. 31, 2022 | Oct. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 1,561 | $ 1,514 |
Less accumulated depreciation | (1,205) | (1,167) |
Property and equipment, net | 356 | 347 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 600 | 557 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 106 | 106 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 827 | 827 |
Computer software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 28 | $ 24 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | Jan. 31, 2022 | Jan. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 43,000 | $ 11,000 |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of intangible assets - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Jan. 31, 2022 | Oct. 31, 2021 | |
Amortized intangible assets: | ||
Gross Carrying Amount | $ 1,687 | $ 893 |
Additions | 32 | 672 |
Impairments | ||
Accumulated Amortization | (928) | (886) |
Net Book Value | 791 | 679 |
Amortized intangible assets [Member] | ||
Amortized intangible assets: | ||
Gross Carrying Amount | 1,565 | 893 |
Additions | 32 | |
Impairments | ||
Accumulated Amortization | (928) | (886) |
Net Book Value | $ 669 | $ 7 |
Amortized intangible assets [Member] | Licensing contracts [Member] | ||
Amortized intangible assets: | ||
Amortization Period | 7 years | 7 years |
Gross Carrying Amount | $ 893 | $ 893 |
Additions | ||
Impairments | ||
Accumulated Amortization | $ (893) | (886) |
Net Book Value | 7 | |
Amortized intangible assets [Member] | Software [Member] | ||
Amortized intangible assets: | ||
Amortization Period | 5 years | |
Gross Carrying Amount | $ 672 | |
Additions | 32 | |
Accumulated Amortization | (35) | |
Net Book Value | 669 | |
In-process intangible assets [Member] | ||
Amortized intangible assets: | ||
Gross Carrying Amount | 122 | |
Additions | 672 | |
Impairments | ||
Accumulated Amortization | ||
Net Book Value | 122 | 672 |
In-process intangible assets [Member] | Software development costs [Member] | ||
Amortized intangible assets: | ||
Gross Carrying Amount | 122 | |
Additions | 672 | |
Impairments | ||
Accumulated Amortization | ||
Net Book Value | $ 122 | $ 672 |
Television Costs and Amortiza_3
Television Costs and Amortization (Details) - Schedule of television costs and amortization - USD ($) $ in Thousands | 3 Months Ended | ||
Jan. 31, 2022 | Jan. 31, 2021 | Oct. 31, 2021 | |
Television Costs and Amortization (Details) - Schedule of television costs and amortization [Line Items] | |||
Television Costs Total | $ 1,589 | $ 1,487 | |
Total | 999 | $ 6,021 | |
In-production [Member] | |||
Television Costs and Amortization (Details) - Schedule of television costs and amortization [Line Items] | |||
Television Costs Total | |||
In-development [Member] | |||
Television Costs and Amortization (Details) - Schedule of television costs and amortization [Line Items] | |||
Television Costs Total | 1,589 | $ 1,487 | |
Television cost amortization [Member] | |||
Television Costs and Amortization (Details) - Schedule of television costs and amortization [Line Items] | |||
Total | 999 | 3,956 | |
Television cost impairments [Member] | |||
Television Costs and Amortization (Details) - Schedule of television costs and amortization [Line Items] | |||
Total | $ 2,065 |
Accrued Expenses (Details) - Sc
Accrued Expenses (Details) - Schedule of accrued expenses - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Jan. 31, 2022 | Oct. 31, 2021 | |
Schedule of accrued expenses [Abstract] | ||
Royalties | $ 1,081 | $ 1,410 |
Payroll, bonus, accrued vacation and payroll taxes | 906 | 1,304 |
Other | 331 | 483 |
Total | $ 2,318 | $ 3,197 |
Commitments (Details)
Commitments (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Jan. 31, 2022 | Oct. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Lease agreements with terms | 3 years | |
Operating leases | 6 months 17 days | |
Weighted-average discount rate | 4.59% | |
Operating leases expenses | $ 125,000 | $ 125,000 |
Cash paid operating leases expenses | 157,000 | 143,000 |
Right-of-use-asset related to operating leases | 1,037,000 | 1,037,000 |
Accumulated amortization related to operating leases | $ 856,000 | $ 735,000 |
Commitments (Details) - Schedul
Commitments (Details) - Schedule of future minimum lease payments required under operating leases $ in Thousands | Oct. 31, 2021USD ($) |
Schedule of future minimum lease payments required under operating leases [Abstract] | |
Rest of 2022 | $ 197 |
2023 | 13 |
2024 | 7 |
2025 | |
Thereafter | |
Total minimum lease payments | 217 |
Less: imputed interest | (3) |
Present value of future minimum lease payments | $ 214 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | Feb. 15, 2021 | Jul. 31, 2020 |
Discontinued Operations and Disposal Groups [Abstract] | ||
Discontinued operations, description | (i) the cancelation of $3.75 million of indebtedness owed by IDWMH to the Chairman’s designee, (ii) a contingent payment of up to $3.25 million based upon a recovery of quarterly revenues of CTM to 90% of its fiscal 2019 levels during the 18-month period following the CTM Sale Date, and (iii) a contingent payment if CTM is sold within 36 months the CTM Sale Date for more than $4.5 million. Prior to executing the SPA, the Company obtained a third-party’s valuation of CTM and a fairness opinion that stated the consideration being received by the Company in the CTM Sale was fair. In addition to the Company’s Board of Directors approving the CTM Sale, the Audit Committee of the Board of Directors, which is comprised entirely of independent directors, approved the CTM Sale in compliance with the Company’s Statement of Policy with respect to Related Person Transactions. The CTM Sale was also approved by (1) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock and (2) stockholders representing a majority of the combined voting power of the Company’s outstanding capital stock not held by the Chairman or immediate family members of the Chairman, including, without limitation, trusts or other vehicles for the benefit of any of such immediate family members or entities under the control of such persons. On December 15, 2020, the right, title and interest to the SPA were assigned to The Brochure Distribution Trust, a South Dakota trust. Since the closing of the CTM Sale, the Company has not had any significant continuing involvement with CTM. | |
Loan amount | $ 3,750,000 | |
Gain net asset | $ 2,123,219 |
Discontinued Operations (Deta_2
Discontinued Operations (Details) - Schedule of statements of operations including discontinued operations $ in Thousands | 3 Months Ended |
Jan. 31, 2021USD ($) | |
Schedule of statements of operations including discontinued operations [Abstract] | |
Revenue | $ 1,219 |
Direct cost of revenue | 840 |
Selling, general and administrative | 1,422 |
Depreciation and amortization | 250 |
Bad Debt | (109) |
Total costs and expenses | 2,403 |
Loss from operations | (1,184) |
Interest expense, net | (13) |
Other income (expense), net | 76 |
Loss before income taxes | (1,121) |
(Provision for) benefit from income taxes | |
Net loss | $ (1,121) |
Discontinued Operations (Deta_3
Discontinued Operations (Details) - Schedule of cash flows $ in Thousands | 3 Months Ended |
Jan. 31, 2021USD ($) | |
Schedule of cash flows [Abstract] | |
Depreciation and amortization | $ 158 |
Amortization of finance lease | 92 |
Amortization of right-of-use assets | 242 |
Capital expenditure | (22) |
Gain on extinguishment of PPP loan | $ (68) |